Following our report on the city living apartment market in the key north and Midlands cities in the January edition we will move south this month and look at supply, demand, rent trends and future prospects for the equivalent market in London.
City living in London, and so investing in it, is probably something of a different proposition to that in the regions. Rather than an urban lifestyle trend like for example, Manchester or Birmingham, it is a well established part of the market here. Tenant demand and expectations also tend to be different in London, with professionals working in 'City' jobs (and placing access to their place of work at the top of their priorities) being a very important factor in the market.
One thing is for sure, London landlords are never likely to be short of potential tenants. Estimates from the ONS in 2014 say that the population in London is growing faster than any other part of the UK. Currently at 8.3m it is projected to rise to 9.4m by 2022 (effectively adding a city with the population of Birmingham to the capital's existing size), with a slower rise to 10.66m by 2037.
The economy is also a relevant factor of course, with London and the south east now seen by many as operating in a different economic orbit to the rest of the country. Latest figures from the Centre For Cities say that between 2004-13 London had the highest jobs growth in the UK with the exception of Milton Keynes and the highest new business growth in the country, with the exception of Aberdeen.
As mentioned, the demand for centrally located property is to some extent linked to jobs growth in the City of London itself. So what's happening here? According to figures from recruitment firm Astbury Marsden around 33,000 new jobs were created in the City in 2014, 18% more than in 2013. They say 7,500 were created in the last quarter alone, a figure which rose sharply compared to recent years. They suggest that a notable number of new jobs have been created in investment banking. However, they believe that jobs growth is currently 'modest' rather than 'aggressive', as was the norm before the financial crisis.
