Modern-day amenities show London new build price premium is worth every penny
London’s new build sector is continuing to evolve to offer more in-house services and amenities to the capital’s buyers in an attempt to battle Brexit uncertainty and beat the competition. But with the higher purchase price compared to existing stock in the market, are these added extras worth the money? Research by new build specialists, Stone Real Estate, has taken a look.
Stone Real Estate looked at the annual cost of eight of the most common and sought after new build amenities regularly included in London developments today, and how this cost stacks up compared to the difference in price between the average new build property and the average cost of existing stock.
According to the latest Land Registry data, the gulf between new builds and existing homes in London is currently £26,691.
Are they worth an additional £27k? Well, many new builds developments now come with a resident’s lounge and while London is home to some very expensive spaces to work and relax, even the most affordable private members club will set you back £150 a year.
It’s becoming more common that new build developments in the capital now offer free Wifi, an amenity in constant use in this day and age and a cost that would otherwise cost you £376 a year.
Whether you use it regularly or kid yourself and only use it once a week, a free to use gym in your new build development can save you as much as £462 in membership fees over the space of a year.
While you may use them far less regularly, paying for your own concierge service for just one hour a week would cost £472 a year, while going to the cinema just once a week would cost £600 a year. Even the cost of paying for additional storage that now comes as standard with many new builds could total £692 a year.
Perhaps the two most sought after and expensive amenities included in today’s new builds are a creche and a parking space and it’s easy to see why as paying for this separately can cost over £2,000 a year each.
All in all, just the cost of these eight services and amenities can total more than £7,000 a year!
Based on the cost of the average London new build, it would take new build homebuyers in the capital just 3.8 years to recoup the difference in house prices through the use of the additional amenities a development might offer.
This, of course, varies across London, and while it would take almost 20 years in Redbridge, it would take less than a year in Southwark or Wandsworth, and in fact, there are a total of 14 London boroughs where the average new build house price is lower than existing stock and so buyers are benefiting from this value straight off the bat.
Founder and CEO of Stone Real Estate, Michael Stone, commented:
“Buying new isn’t just beneficial in terms of the standard of home your buying, which in itself is arguably worth the premium, it’s also about the wide range of benefits that now come with a modern-day development.
While not every development will offer the same incentives, they will all include additional draws above and beyond the property itself that enhance the life of a London home buyer in some shape or form. It can be as simple as a transactional incentive such as paid stamp duty, or a lifestyle benefit like a free on-site gym, creche or even a more traditional benefit such as a parking space.
Some of these benefits may sound insignificant in terms of cost, but once you start to add them all up, your paying quite a substantial amount of money and so to have these already taken care of under one roof is something that buyers really go for in today’s market. After all, it’s not just about cost-saving, but convenience and ease of lifestyle as well.”
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Amenities / Services
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Average cost per month
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Average cost per year
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Cost information / links
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Concierge
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£39
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£472
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Cinema room
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£50
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£600
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Parking
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£192
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£2,303
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Gym
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£38
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£462
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WiFi
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£31
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£376
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Creche
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£170
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£2,045
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Storage units
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£58
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£692
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Resident lounge
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£13
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£150
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Total:
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£592
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£7,099
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London – New Build vs Existing Average House Price by Borough
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Location / Borough
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NB AveHP
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Existing AveHP
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Difference (NB – Existing) £
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Years to recoup cost difference*
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Redbridge
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£554,175
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£418,889
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£135,286
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19.1
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Newham
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£467,218
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£343,651
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£123,567
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17.4
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City of London
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£845,130
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£725,647
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£119,483
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16.8
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Barking and Dagenham
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£389,309
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£298,426
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£90,883
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12.8
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city of Westminster
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£1,019,210
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£928,402
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£90,808
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12.8
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Merton
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£590,136
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£506,072
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£84,064
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11.8
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Hackney
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£594,773
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£553,253
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£41,520
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5.8
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Havering
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£403,619
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£366,482
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£37,138
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5.2
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Waltham Forest
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£454,857
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£418,965
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£35,893
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5.1
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Kingston upon Thames
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£536,170
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£502,175
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£33,994
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4.8
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Lambeth
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£538,075
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£505,517
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£32,558
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4.6
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Hillingdon
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£432,421
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£400,724
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£31,697
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4.5
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Sutton
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£400,905
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£375,952
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£24,953
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3.5
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Greenwich
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£416,404
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£395,520
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£20,884
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2.9
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Bromley
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£454,898
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£436,418
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£18,480
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2.6
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Tower Hamlets
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£442,666
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£427,833
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£14,833
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2.1
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Barnet
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£521,091
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£509,546
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£11,545
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1.6
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Southwark
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£506,706
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£502,453
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£4,253
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0.6
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Wandsworth
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£589,105
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£587,967
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£1,139
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0.2
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Ealing
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£474,540
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£478,537
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-£3,996
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-0.6
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Lewisham
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£405,332
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£412,951
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-£7,619
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-1.1
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Camden
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£859,712
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£869,014
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-£9,302
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-1.3
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Bexley
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£327,614
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£339,589
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-£11,975
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-1.7
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Croydon
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£349,197
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£364,999
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-£15,802
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-2.2
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Brent
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£452,202
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£470,945
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-£18,744
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-2.6
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Enfield
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£372,493
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£391,624
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-£19,131
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-2.7
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Hounslow
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£367,242
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£399,944
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-£32,702
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-4.6
|
|
Haringey
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£513,140
|
£555,841
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-£42,701
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-6.0
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Harrow
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£407,563
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£457,811
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-£50,247
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-7.1
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Islington
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£582,390
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£634,824
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-£52,434
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-7.4
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Hammersmith and Fulham
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£665,976
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£740,090
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-£74,114
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-10.4
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Richmond upon Thames
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£549,311
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£663,039
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-£113,728
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-16.0
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Kensington and Chelsea
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£1,130,880
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£1,306,708
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-£175,828
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-24.8
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Inner London
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£565,685
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£568,221
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-£2,536
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-0.4
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Outer London
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£426,302
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£423,248
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£3,054
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0.4
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London
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£505,255
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£478,564
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£26,691
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3.8
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United Kingdom
|
£296,343
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£229,288
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£67,055
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9.4
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*Cost to recoup is the number of years it would take the £7,099 annual saving on amenities to bridge the gap between existing property cost and the new build property cost.
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