I wrote a few weeks ago that if you leave a market alone, in the end it will sort itself out. High prices will bring on more supply and prices will fall. I added that this the supply bit at least - seems to be happening in London. Prices are high, rents are high. And what's happening? A visible effect on local supply.
"There are 1,000 flats coming here in White City. There are 5,000 at the Olympic Village, 7,500 on the way in Earls Court (maybe more), 5,000 at Battersea Power Station (the "real estate opportunity of a lifetime"), 800 at Lots Road, 700 in Ealing, 7,300 in Croydon, a few thousand more at King's Cross and 5,000 at the Royal London Docks and that's just the beginning of a long list."
Since I wrote that, I see more and more signs of rising supply. There is this article from the Evening Standard on the way foreign governments are noticing that their embassies have turned into goldmines, and are therefore getting around to flogging them for luxury developments.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
There has been an announcement of a new tower at Elephant and Castle (44 stories, 450 flats) on top of the 5,000-odd already planned. It may be that demand for London property is infinite and these tens of thousands of units are a drop in the ocean of need. But it will still be interesting to see what happens if a chunk of them reach completion just as interest rates rise in, say, 2015/2016.
If you know of any big developments I have missed please pop them in the comments section below so we can have a go at adding it all up!
-
Christmas at Chatsworth: review of The Cavendish Hotel at BaslowMoneyWeek Travel Matthew Partridge gets into the festive spirit at The Cavendish Hotel at Baslow and the Christmas market at Chatsworth
-
Tycoon Truong My Lan on death row over world’s biggest bank fraudProperty tycoon Truong My Lan has been found guilty of a corruption scandal that dwarfs Malaysia’s 1MDB fraud and Sam Bankman-Fried’s crypto scam
-
House prices to crash? Your house may still be making you money, but not for much longerOpinion If you’re relying on your property to fund your pension, you may have to think again. But, says Merryn Somerset Webb, if house prices start to fall there may be a silver lining.
-
Prepare your portfolio for recessionOpinion A recession is looking increasingly likely. Add in a bear market and soaring inflation, and things are going to get very complicated for investors, says Merryn Somerset Webb.
-
Investing for income? Here are six investment trusts to buy nowOpinion For many savers and investors, income is getting hard to find. But it's not impossible to find, says Merryn Somerset Webb. Here, she picks six investment trusts that are currently yielding more than 4%.
-
Stories are great – but investors should stick to realityOpinion Everybody loves a story – and investors are no exception. But it’s easy to get carried away, says Merryn Somerset Webb, and forget the underlying truth of the market.
-
Everything is collapsing at once – here’s what to do about itOpinion Equity and bond markets are crashing, while inflation destroys the value of cash. Merryn Somerset Webb looks at where investors can turn to protect their wealth.
-
Value is starting to emerge in the marketsOpinion If you are looking for long-term value in the markets, some is beginning to emerge, says Merryn Somerset Webb. Indeed, you may soon be able to buy traditionally expensive growth stocks on the cheap, too.
-
ESG investing could end up being a classic mistakeOpinion ESG investing has been embraced with enormous speed and zeal. But think long and hard before buying in, says Merryn Somerset Webb.
-
UK house prices will fall – but not for a few yearsOpinion UK house prices look out of reach for many. But the truth is that British property is surprisingly affordable, says Merryn Somerset Webb. Prices will fall at some point – but not yet.
