COMMUTING AND CONNECTING IN THE CAPITAL - STEPHEN PALFREEMAN - THE INTERMEDIARY
25.08.23
COMMUTING AND CONNECTING IN THE CAPITAL
By Stephen Palfreeman, Associate Director - London at Tuscan Capital Limited.
A huge factor in the London market of late has been the opening of the Elizabeth Line, formerly known as Crossrail. The train line is one of the most ambitious transportation projects the capital has ever seen, and has dramatically improved connectivity across the city.
The Elizabeth Line runs for more than 100km, from Reading and Heathrow in the west of London to Shenfield and Abbey Wood in the east, and it has had a noticeable impact on the housing market, too.
We have seen a significant surge in new-build developments over the past few years in areas served by the new line, as developers have looked to tap into the likely spike in demand from buyers and tenants to make use of the Elizabeth Line for their commute.
That demand is already feeding through. The introduction of Crossrail has had a positive impact on property prices in the vicinity of the Elizabeth Line stations, a movement that is only likely to continue as the line becomes fully operational.
Many of these developments would ordinarily have completed some time ago, but they have been hit by inevitable delays due to the challenges of the past few years.
The pandemic and supply chain issues over the labour and materials used in the developments have caused projects to take longer to reach the finish line, with significant numbers only recently starting to complete.
Opportunities
This, in turn, is sparking greater demand for short-term finance. We have seen interest from all sorts of buyers who have put down deposits on these new-builds - in some cases many years previously - but who are now being served notice to complete.
The situation has provided another excellent insight into the value of short-term finance in the current environment. First and foremost, these deals can be arranged in much shorter timescales, delivering the funds within just a matter of days - rather than the weeks or even months that it can take for longer-term facilities to be put in place.
There is also the matter of cost. These buyers have seen the costs of regular mortgages rocket in recent months, making them even less appealing. As a result, short-term finance becomes even more viable, allowing those buyers to complete on the deal and consider their options, in the hope that mortgage rates begin to to settle - and even fall - in the months ahead.
Work to be done
Notable new-build projects to have completed recently include the Filmworks development in Ealing Broadway and One West Point in Acton. These have caught the eye because of their location, delivering commuting times to central London of just 12 minutes.
The Filmworks development, in particular, has demonstrated the increased prevalence of mixed-use developments across new-builds, since it combines not only the properties themselves, but also an eight-screen cinema and mix of restaurants, coffee shops and leisure facilities.
It's a trend that is becoming more common in developments across the capital, with the builders looking to create a vibrant atmosphere by bringing together commercial, leisure and retail alongside residential units.
For all the positivity around housing in the capital, however, affordable housing remains a concern. London is the costliest place to purchase a property, and while developers are working to incorporate affordable units into their schemes, there remains work to be done here.
Read the August edition of The Intermediary Magazine here.
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A range of case studies demonstrating examples of previously completed loans can be found here.