Conclusions from Tuesday’s ‘The Steeple Times’ 12 Hay Hill debate on the London property market
On Tuesday 17th May, The Steeple Times hosted its second panel debate at 12 Hay Hill in Mayfair. A lively audience of fifty people quizzed a panel of four chaired by Jackie Branston and discussed the topic: “Is there a Dante’s Inferno coming for London’s property market?”
After drinks with 12 Hay Hill’s chief executive Simon Robinson and marketing and events manager Gabriella Torres-White, the assembled panel – which included property consulant and Crayson managing director Nick Crayson, interior designer and founder of The Room Company Genny Henderson, SCM Group co-founder and “Britain’s original hedge fund man” Alan Miller and luxury property agent and founder of 1st Asset Andy Smith – spent an hour in conversation with Jackie Branston and answered questions from those who had travelled from as far as Oxford, England and Melbourne, Australia.
Starting with a response to a question from Mayfair based Mark Norris of Merrick Real Estate on the effects of interest rates, Alan Miller announced he “was not personally bullish on the property market” and added “estate agents would say everything is going up forever”.
Nick Crayson responded to suggest: “London property prices have always been high in general” but cautioned with the idea that “you can’t talk about ‘London’ generally… Each area is its own animal and each behaves differently”.
Andy Smith took another view and argued that prime central London is not led by interest rates. He pointed out that 90% of top end purchases are made in cash and that there is no relativity at the top-end compared to the bottom end. Smith then moved the debate on and pointed out that though Kensington and Chelsea may be a long-term “best bet”, the market in such places as Kent and Birmingham is now rocketing as “London is hesitating”.
Genny Henderson, whose main clients are in Marylebone and Mayfair, noted that Savills in W1 had told her earlier in the day that they were “selling well at the top-end” and brought up the fears of what might happen as a result of BREXIT. The audience expressed mixed views on this and whilst one, Gina Miller, raised the prospect of the effects of banks moving their headquarters out of London, another, Penelope Bouchot Humbert instead blamed “George Osborne’s tinkering” as a factor that has dampened the market.
Moving on, Jackie Branston lamented “soulless London” and how so many longstanding businesses – such as Allen in Mount Street, Mayfair and Talisman in Ebury Street, Belgravia – have been forced to close due to soaring rents. Andy Smith pointed out that this is in part the fault of greedy landlords such as Cadogan and Grosvenor but property agent Mira Navi cautioned with a thought about the fact that 25 to 35 year olds now simply cannot afford to buy in Chelsea “as much as [she] enjoys the SW3 lifestyle”. As a result, with no lights on and nobody home (other than empty units bought by foreign investors), it is not surprising that businesses fail most agreed.
Taking this further, Alan Miller pointed out that only those on a salary of upwards of £87,000 could afford London’s average home price of £650,000 and though Andy Smith suggested this be compared to similar situations in Hong Kong and Singapore, the audience generally agreed with Nick Crayson that “the uber wealthy do skew the figures” with such purchases as £100 million penthouses in One Hyde Park.
A comment from barrister James Dove about how agents selling his mother’s home in Chiswick had told him “anti-money laundering legislation has virtually halted their business with foreign investors” surprised some. A fellow audience member from Zest Media – publishers of the Absolutely series of property-led titles – argued instead: “It is wrong to be resigned to London being dead, foreign money is coming into such places as Clapham and Islington now” whilst Andy Smith countered by suggesting “boundaries always move… It used to be Chelsea and then it was Fulham… People now look for value in places like Kent instead”.
The panel concluded by talking about short leases and whether agents needed to be licensed. Nick Crayson surprisingly went as far as to say “yes” to regulating the industry and suggested education of them and the public is required; Alan Miller offered something else: “People at the top aren’t currently buying, people at the bottom simply can’t afford to buy”.
Dante’s Inferno and a property crash, in conclusion, haven’t arrived yet in London and though it is unlikely either will anytime soon, here was a panel that agreed that something has got to give.
Pictures by Simon Ogilvie-Harris.
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