London’s social cleansing gold rush slows down

 

Oh dear, London’s high-rise, astronomically-priced, new ‘housing’ for absentee international investors is not selling quite so well!

As Matt Bain reported here in January    http://youngmoneyblog.co.uk/daves-regeneration-con-trick-why-it-will-compound-the-housing-crisis/

in his analysis of David Cameron’s new ‘regeneration’ plans for council estates, the first phase of the glossily-advertised Lillie Square at Earls Court, at prices up to £6m, seemed to be going like hot cakes.

It is the first phase of Capco’s masterplan for Earls Court, which has already seen the razing of the exhibition centres, and is set on the demolition of 760 homes in the West Kensington and Gibbs Green estates in the name of regeneration.

But the FT reported today:   “The London market — once the favoured choice for a trophy property among wealthy international investors — is suffering the uneasy combination of growing supply and shrinking demand.

“The effects are already being felt on developers. Shares in Capco, a London property company, dropped 8 per cent after it revealed last Wednesday that sales of apartments in its Lillie Square development in west London — which cost between £600,000 and £6m — had not risen since November. The company cited ‘challenging conditions . . . as a result of increasing supply’. Capco’s shares are down 27 per cent since the start of the year and investors have also punished other UK-listed companies. Shares in St Modwen, which owns 57 acres of development land in Battersea, south of the Thames, are down by a fifth. Meanwhile four hedge funds have taken short position against Berkeley Group, a high-end UK housebuilder.”

Interesting times ahead, especially as mayoral candidate Sadiq Khan is talking about ‘resistance to social cleansing’ in the capital.

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