New House Building Slumps in Hampstead by 56.73%

One of the key factors that determine the price of anything is the demand and supply of the item that is being bought and sold. When it comes to property, demand can change overnight, but it takes years and years to build new properties, thus increasing the supply.

The Conservatives have pledged to build over 1 million homes by 2020. I am of the opinion that as a country, irrespective of which party, we have not built enough homes for decades, and if the gap between the number of households forming and the number of new homes being built continues to grow, we are in danger of not being able to house our children or grand children. I believe the country is past the time for another grand statement of ambition by another Housing Minister. Surely it’s right to give normal Hampstead families back the hope of a secure home, be that rented or owned. As a town, we need to exert pressure on our local MP, Tulip Siddiq, so she can make sure Westminster is held accountable, to ensure there is a comprehensive plan, with enough investment, that can actually get these homes built.

To give you an idea of the sorts of numbers we are talking about, in the London Borough of Camden  in 2005, 720 properties were built. In 2006 that rose to 790 and three years later in 2009, it peaked at 1,040. By 2015, that figure had dropped by a massive 56.73% to 450 properties built. See the graph below that illustrates these patterns. Source: London Borough of Camden.

The outcome of too few homes being built in Hampstead means the working people of the area are being priced out of buying their first home and renters are not getting the quality they deserve for their money. The local authority isn’t building the estates they were after the war and housing associations are having their budgets tightened year on year, meaning they have less money to spend on building new properties. I know of many Hampstead youngsters, who are living with their parents for longer because they cannot afford to get onto the housing ladder and growing families are unable to buy the bigger homes they need.

I talk to many Hampstead business people and they tell me they need a flexible and mobile workforce, but the high cost of moving home and lack of decent and affordable housing are barriers to attracting and retaining employees. Furthermore, building new homes is a powerful source of growth, creating jobs across the capital and supporting hundreds of Hampstead businesses. It is true that landlords have taken up the mantle and over the last 15 years having bought up a large number of properties. The Government need to be thankful to all those landlords, who own the 3,751 rental properties in the Hampstead and Kilburn Constituency. Most local landlords only have a handful of rented properties (to aid their retirement), and without them, I honestly don’t know who would house all the extra people in Hampstead!

Moving forward, those Hampstead landlords have many pitfalls, both in the short term and medium term. For instance, the rules of changes for new tenancies from the 1^st October 2015 (with some imposing penalties including loosing the right to require the tenant to vacate, if they are done incorrectly) or in the medium term, the planned change in the way buy to let’s are taxed.

More than ever, the days of buying any old property in Hampstead and you would be set for life are gone. Now, it’s all about ensuring you stay the right side of the law, buying the right property (and that might mean even selling some to buy others), so you build the right portfolio for you as a landlord.

For more opinion and analysis on the Hampstead property market, visit my blog www.NW3propertyblog.com If you have an investment in mind I can help with a range of things such as advise on properties that will get you the best returns whilst complying with all current regulations or on how to maximise the income potential of your current asset(s). I can also introduce investment/refurbishment opportunities that will enable you to create value and give you decent returns. If you are interested to work with me then get in touch chris@ashmoreresidential.com  or pop in to the office for a chat, I’m just on Heath Street, 50 meters from Hampstead Tube.

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If you are looking for an agent with experience that can help you find the right tenant for your property, then contact us to find out how we can get the best out of your investment property. Email me on chris@ashmoreresidential.com or give me a call on 020 7435 0420. Pop in for a chat – we are based on Ashmore Residential, Suite 7, 25-27 Heath Street, London, NW3 6TR. The kettle is always on.

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