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House building at all-time low as property sales stagnate
Mira Bar-Hillel27.01.09
PRIVATE home building in London is grinding to a halt, figures reveal today.
Work began on 1,000 private residential properties in the capital in the last three months of last year - down 60per cent on the same period a year earlier to an all-time low.
In those three months only 34 large developments of 20 flats of more were started, according to the National House Building Council.
Projects that have been started but not completed in the past three months include plans for 93 private flats at Pims House, Islington, where the developer Lovells is understood to be re-thinking prices, and Middleton Road in Sutton where work on 25 homes has stalled.
On the Clapham Park Estate, in Lambeth, none of the 1,500 homes planned for the site has been built while in Streatham, developers Genesis are said to be considering building 28 affordable homes instead of private ones in Streatham High Road.
The tail-off in construction accelerated throughout the year as the credit crunch paralysed the market. The industry is now bleaker than it was in the depths of the Nineties recession.
Experts say the sharp fall in supply is a reaction to stagnant sales as potential buyers struggle to secure mortgages and believe prices may fall yet further. Imtiaz Farookhi, the council's chief executive, said: "Our figures for 2008 are the lowest since records began. We anticipate the volume of new home starts to remain relatively low throughout 2009."
Lucian Cook, residential research director at agents Savills, said: "Price falls in the new homes sector have been greater than in the second-hand market."
The £1.5 billion regeneration of Elephant & Castle has also been delayed. A deal confirming the revamp was supposed to have been signed last July but is now not expected until late spring.
Developer Lend Lease said it is waiting to conclude negotiations with Transport for London over alterations to transport links.
But the company, which has scaled down its building commitments in the 2012 Olympic Village, is known to have had severe problems raising funds.
