Friday 4 March 2016

Will the Wembley luxury flat bubble burst?

Wembley Park from Barn Hill this morning
Few local people are able to buy or rent the luxury flats that are being thrown up by Quintain and other developers in Wembley Park and it now looks doubtful if overseas investors will be interested.

Morgan Stanley warned this week that  prices of upmarket London flats could fall by as much as 20% this year reflecting the impact of stamp duty increases on buy-to-let homes, a weaker global economy and Brexit fears.

The Evening Standard quoted Trevor Abrahamson, head of Gentree International:
Asian buyers - from Malaysia, Singapore, Hong Kong and China - are walking away from their commitments to buy properties in, for instance, east London and None Elms. They would rather lose 10% than complete for purchase and lose a lot more, even before the developments are complete. The changes to buy to let is the 'straw that broke the camel's back.'

In pockets of London's newly developed areas, where there is a lot of speculative developments, the outcome could quickly turn nasty with buyers drying up, developers having to cut prices and investors dumping their newly acquired flats before construction of them has finished.
The area around Wembley Stadium is rapidly looking like a jumble of unchecked, speculative development rather than the pastel shaded mixture of homes and parks pictured in consultation documents of yesteryear. Dominated by rabbit hutch flats with high spec kitchens, private student accommodation and hotels, the regeneration is beginning to look high risk.

Coincidentally  RIBA have published a study of 'rabbit hutch' homes and concluded:
Based on our sample, the average new home in England is only 92% of the recommended minimum size.

The average one bedroom home from our sample of 1,159 homes across 41 sites
is 46 sqm. It is 4 sqm short of the recommended minimum for a single storey, one bedroom home for two residents.

4 sqm is just a number. But in lifestyle terms it means...
The equivalent of a single bed, a bedside table and a dressing table with a stool.

3 sqm is the equivalent of a 3 seat sofa and a desk and chair.

4 sqm is the space that allows you to work at home at the computer in the day and also have an extra sofa when you’ve got friends round in the evening. 4 sqm might not sound like much but it could make everyday life a lot more comfortable.

The average three bedroom home from our sample of 3,418 homes across 71 sites
is 88 sqm. It is 8 sqm short of the recommended minimum for a two storey, three bedroom home for five residents.

8 sqm is just a number. But in lifestyle terms it means...
The equivalent of a single bedroom and the furniture you’d expect to t comfortably within it. 7 sqm is the equivalent of a galley kitchen and a coffee table. 8 sqm is the single bedroom you’re missing. It’s the space for a new arrival to the family, the space that means the kids have a room of their own or a spare room for a guest to stay over. It’s the space that could take the kitchen out of the lounge and the sounds
a and smells that go with it.


Jaine Lunn said...

Sad but true.
The issue concerning what will befall these developments is to look back in history, that these so called Developers haven't learnt from their past mistakes when it comes to regenerating the London Borough of Brent.
The real boom years for tower block building in the UK were from about 1953 to 1972. With the average dwelling of 3 occupants, across the UK this account for 1.2 million people or about 1.5% of UK population living in High Rise accommodation.
Huge high rise housing developments were built in Stonebridge and Chalkhill 50 years ago, huge estates comprising of rented social housing. Many were 3 and 4 bedroom family sized homes to accommodate families in excess of 2 Adults 2 children. Fast forward 30 years and it was becoming clear, that these were not suitable developments with which to house growing families with young children and adolescents. Fostering very little community spirit or friendly chats with neighbours, devoid of parks, green open space, these estate very quickly became a centre for gang activity, and drug dealing, a logistic nightmare for the Postman, and Police, who faced with trying to deal with crime, consistently hampered by badly lit hallways, a rabbit run of alleyways, Lifts that more often than not didn't work, and the prospect of what some might have seen as climbing Everest to get to your home via a filth ridden staircase.
In reality the majority of High rise flats were criticised in later years for creating poor quality badly built housing and high-density estates with many of them becoming hard to let and hard to live in. Many estates developed a bad reputation with a high concentration of problem tenants. By the mid 1980's council's began to move people out and re-house them elsewhere.

Nearly all have been demolished at great expense, and replaced by low rise family homes, with the majority not being above 4 floors, tree-lined little streets with parking spaces, some with the luxury of space on a gated drive.
Quintain whom I understand are now owned by Lone Star a Texan private equity giant ( bought for £745 million), burnt the history book and have embarked on a plan to build 5,000 homes.
Actually these properties are not homes, or being sold or marketed at affordable rent to house the 20,000 or so on Brent Councils waiting list or in temporary accommodation. There are very few if any family sized homes of 3 beds+. The majority of Brent residents wanting to buy a home cannot afford to buy a 1 bed Barratt home of 51.2 sq mtrs advertised at £390,000, currently being built on Olympic Way.
These flats/studio's apartments (if your kitchen is in the living area) crash pads as I would call them, are for single people and couples who work in Central London or the City only a 20-35 minute commute, do not cook, they eat out or buy takeaways, and spend little time in them only to sleep. They are young, under 35, with no children ( and clearly should not be looking to have any in the foreseeable future - as these flats don't have enough space or storage), and only require essential furniture i.e. a Bed, Sofa, coffee table etc.
It will be interesting to see what happens to the Rabbit Hutch developments over the next 10 years.

All involved should be careful what they wish for............

G.Lee said...

spot on analysis Jaine...and the Alperton Gateway development will add even more high rise hutches

Jaine Lunn said...

thanks Glynis, you perhaps understand better than most. Brent House has not got planning permission for 5 blocks, 250+ homes, and it states on planning permission that there is insufficient play space for the expected 100+ children. The Council have leased almost all of what was Coplands Fields to Ark Academy and the another few acres will go to Elsley Primary for an additional 4 classrooms, so very little open green playspace left, would be enough for a Wembley Adventure Playground but would they give permission? It's badly needed. We fall far short in Wembley Central of the recommended amount for the number of residents and children. Its very much a case of all the gear and no idea.

Martin Francis said...

It would be interesting to hear what Wembley Central ward councillors think about the issues you raise. Perhaps the Wembley Masterplan (or whatever its present title is) should be reviewed or the whole regeneration strategy examined hy Scrutiny Committee.

Philip Grant said...

Not forgetting the two tower blocks that a developer wants to build on the site of Chesterfield House (corner of Wembley High Road and Park Lane). Again, not a chance of any outdoor green space, apart from King Edward VII park a few minutes walk away.

I used to work on the fifth floor there in the 1990's - I dread to think what it would be like living on the 25th floor!