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Thursday, April 26, 2018, 20:04
London developer bullish on home-price outlook
By Lin Wenjie
Thursday, April 26, 2018, 20:04 By Lin Wenjie

Construction work continues on the roof of One Blackfriars, also known as the Vase, where workers are installing large glass panels onto the exterior of the 163 meter skyscraper on the south bank of the river Thames in London, on March 15, 2018. The building is a mixed use development, one of the highest residential buildings in Europe and is due for completion in 2018. (JUSTIN TALLIS / AFP)

Home prices in London remain at high levels but developers are optimistic that a shortage of quality residences in some areas will ensure strong demand from domestic and overseas buyers, Lodha UK Director Gabriel York believes.

Lodha UK – a London-based luxury development company and a subsidiary of India’s largest real-estate developer, Lodha Group, projected a 25 percent price increase over five years. The group entered the United Kingdom capital’s property market in 2013, acquiring two prime sites in central London for an investment of about 400 million pounds (US$557 million).

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“According to the property cycle, we can see that the house prices in London usually grow for eight to nine years, then we can see the monetary policy tightened and there’s a middle way point when the prices are somewhat flat,” York said.

“After a short while, when the monetary policy again loosened and additional lending was released into the market, the house prices gradually started to hike again. So, we can see house prices in London this year will be somewhat flat but starting from some point in 2019, the prices will be heading for eight to nine years’ growth, at 5 to 6 percent annually, so the next five years, the growth will be 25 percent,” he said.

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Moderate growth is good for the property market, he added, as a sharp increase in house prices is always unsustainable.

The developer is offering worldwide investors its new projects, Lincoln Square and No1 Grosvenor Square, which are due to be completed in the first quarter and fourth quarter of next year respectively.

The Lincoln Square is near three of London’s finest education institutions – the London School of Economics, the University College London in Bloomsbury and King’s College London – making it a preferred rental choice for students in those schools. And it is also adjacent to the Royal Courts of Justice, New Court chambers and the old Land Registry building, so the project is quite popular among lawyers working nearby. In fact, 50 percent of the 211 apartments were sold 12 months prior to completion.

Situated on London’s Grosvenor Square in Mayfair, No1 Grosvenor Square enjoys the world’s most desirable address. The building has served as the United States Embassy and the Canadian High Commission, and has been home to some of the world’s most influential minds including Samuel Johnson. About a quarter of the 44 apartments in No1 Grosvenor Square have been sold to date.

The starting price for units at Lincoln Square is 1.29 million pounds, while those at No1 Grosvenor Square start from 8 million pounds.

Global property experts CBRE show the rental market of the area is diverse with strong performance, and sales achieved in nearby developments illustrate there is considerable investment upside potential.

Lodha UK is eyeing sales revenue of 1.5 billion pounds between this year and 2020 from two ongoing housing projects in central London.

cherrylin@chinadailyhk.com



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