Most of us know that the cost of housing in SE16 has been constantly escalating over recent years. Whether you rent your home, live in a leasehold flat or own your property outright, the price of your home is a constant factor in all your financial calculations. Bermondsey and Rotherhithe are some of the most sought after addresses in London at the moment and the cost of buying or renting locally continues to rise far above the increase in wages or salaries. New developments in Surrey Docks and Canada Water continue to come on the market fuelling the price rises still further.
For many the cost of their mortgage or rent is a key part of their household expenditure. Falling behind with rent can have dire consequences as landlords are ever more ready to press for rent arrears and to take legal action to repossess properties that are not up-to-date with payments. Mortgage rates remain lower than historic levels but as many people have overstretched themselves to purchase in SE16, even small increases in the mortgage rates can have a devastating effect on some budgets. With so many living on a housing knife edge, the underlying upward trend in prices of both rental and sale properties makes for bleak reading.
Zoopla reports a 14% annual rise in prices across the board in SE16. Foxtons says houses in SE16 have for the first time averaged £500,000 sale price in 2014, whilst flats are falling further behind at an average sale price of less than £400,000. In the rental sector, flats are letting at an average of £392 pw and houses at £727 pw according to Foxtons. Not surprisingly, most properties for sale or rent in SE16 are flats taking up nearly 90% of the sales market in the last year (Home.co.uk). The number of properties being sold has dropped in recent months (Home.co.uk) but with the summer period – always the height of the property market – yet to report, its difficult to know for sure how this year will turn out.
What can be done to reduce the upward pressure on housing prices? How are local young people ever to get their foot on the housing ladder? Should we become content to be a renting society? Do we need new laws to restrict sales to overseas investors? Should the Council be more vigilant about taxing vacant properties? The housing market is a complex one with many unintended consequences to any change in the environment. And SE16 does not stand alone. London is racing ahead of the rest of the UK in house prices and the UK faces some difficult dilemmas in building an economy based on output rather than property price boom and bust.