FOCUS ON: STAINES-UPON-THAMES - RESIDENTIAL RESEARCH 2016 2018 - AFFORDABILITY SUPPLY VS DEMAND - Knight Frank
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RESIDENTIAL RESEARCH FOCUS ON: STAINES-UPON- PARSONS GREEN THAMES 2016 2018 AFFORDABILITY SUPPLY VS DEMAND COMMUTER LOCATION COMPARISON
FIGURE 1
Price growth in Spelthorne, Surrey,
South East, London and UK
ALL IN THE NAME
Prices indexed 100 = Jan 2013 Over the last 10 years Staines has been rejuvenated,
Spelthorne South East United Kingdom
culminating in a name change to Staines-upon-Thames
Surrey London in 2012.
160
Situated in the borough of Spelthorne in commuter belt. In comparison, it might
150
Surrey, in close proximity to Heathrow be argued that Staines-upon-Thames is
140
Airport, the M25 and the M4 Corridor, a relatively undervalued market given its
Staines-upon-Thames forms part of geographical location.
130 the Enterprise M3 Local Economic
Partnership, the UK’s digital economy However, there are signs that this is
120 hub employing over 50,000 workers. starting to change. During the twelve
months to September 2017, house prices
110 On top of a burgeoning local economy,
in Staines-upon-Thames increased
Staines-upon-Thames is surrounded
100 by some of the most expensive real by 6.6%, outpacing growth of 3%
estate in the UK outside of London across Surrey. Despite this recent
90 (figure 2). Towns such as Virginia Water, outperformance, average house prices
2013 2014 2015 2016 2017
Walton-on-Thames, Windsor and in Staines-upon-Thames remain around
Source: Knight Frank Research, Land Registry,
Macrobond
Weybridge form part of London’s prime 23% below the Surrey average.
FIGURE 2 Average sale price in the last 12 months
Average Sale Price
Windsor Year to Oct 2017
"
) Heathrow
Airport
Sub £250,000
£250,000 - £500,000
£500,000 - £1,000,000
£1,000,000 - £2,500,000
£2,500,000 - £5,000,000
£5,000,000+
Staines-upon-Thames
"
)
Virginia
Water Shepperton
Chertsey
Walton-on-Thames
"
)
Weybridge
Woking
Source: Land registry "
)
Contains OS data © Crown Copyright and database right 2017
2 Please refer to the important notice at the end of this reportCommuter belt affordability the Ministry for Housing, Communities
FIGURE 3
and Local Government (figure 5). The
Spelthorne also has a lower house price House price to earnings ratio
number of households in Spelthorne is House price to household income ratio
to household income ratio – a common
forecast to climb 24% to 52,000 by 2039
measure of affordability – than the wider
according to official projections.
Surrey, South East and England markets.
The average home costs 7.6 times Staines-upon-Thames has 756 private
Spelthorne’s median annual income, units in the development pipeline,
according to analysis of Experian and according to Glenigan. Two schemes
Land Registry data, as shown in figure 3. exceed 200 units, and are located on
This may be one factor attracting greater the High Street and Bridge Street.
numbers of Londoners to the town. Data Demand for new homes in Spelthorne
from the Office for National Statistics has been boosted by the Help to
(ONS) show 58% of residents moving to Buy Equity Loan scheme, which has
Spelthorne were from London in 2016, accounted for 144 sales since its
up from 51% in 2013. inception in April 2013. We expect this
7.6x 8.3x 8.0x 9.5x 7.7x
The private rented sector is the fastest trend to continue in the new homes
growing tenure type across the UK, sales market.
and accounts for a fifth of the housing Spelthorne Surrey South East London England
stock in Staines-upon-Thames (figure Connectivity Source: Experian, Land Registry
6). Demand for rented accommodation Heathrow Airport and the air freight
comes mainly from young professionals sector are two of the largest local FIGURE 4
and students at the Royal Holloway employers in Staines-upon-Thames, Housing stock by age
University in Egham, home to more with over 6,000 employees of Staines-upon-Thames
than 9,000 students, Mosaic household Heathrow Airport living in the borough
analysis shows. of Spelthorne. Other large employers
include BP, Shepperton Studios, 34.2%
A lack of new homes British Gas and Wood Group Kenny. 30.8%
As such, a considerable proportion of
As a whole, the UK has an undersupply
of new homes and Spelthorne is
working residents in Staines commute 24.6%
to neighbouring boroughs as opposed
no exception.
to central London. This is evidenced by
There were 347 net additional dwellings commuting data from the ONS which
delivered in the borough during 2016-17, shows that, of the 18,001 residents
falling well short of estimated demand. commuting to London boroughs, 54%
10.4%
Spelthorne needs 590 additional homes work in Hounslow and Hillingdon.
a year if it is to satisfy the needs of the Around 10% commute into Westminster, Pre 1900 1900-1939 1945-1972 1973-Present
growing local population, according to the City of London and Tower Hamlets. Source: Knight Frank Research
FIGURE 5
Housing supply vs housing need
600
500
Net additional dwellings
400
300
200
100
0
2011-12 2012-13 2013-14 2014-15 2015-16 2016-17
Spelthorne net additional dwellings Spelthorne annual housing need, 2016-2026
Source: MHCLG
3FOCUS ON: STAINES-UPON-THAMES RESIDENTIAL RESEARCH
However, the fundamentals are in place Meanwhile, from 2019, the Elizabeth less than 33 minutes and 40 minutes
for Staines-upon-Thames to establish Line (Crossrail) will run from Reading away respectively.
itself as a commuter location for the to Shenfield via central London, cutting
Further ahead, proposals for a second
capital. The fastest trains into London journey times for millions of commuters.
Crossrail line, running from South
Those living in and around Staines-
Waterloo take 35 minutes, a commute West London to North East London
upon-Thames will be within a 15 to 20
on a par with Weybridge and faster (Crossrail 2), include a regional branch
minute drive of three Crossrail stations
than nearby Windsor, Chertsey, Virginia from Raynes Park to Shepperton, which
at Iver, West Drayton and Hayes and
Water and Egham, as shown in figure 7. Harlington. Travel times to Bond Street would provide Staines-upon-Thames
Annual rail season ticket prices are also will be reduced from 38 minutes to less with a fourth Crossrail station within
lower than prices for similar tickets from than 26 minutes from the three stations, a 20 minute drive of the town centre.
stations in the surrounding area. with Liverpool Street and Canary Wharf However, it is worth noting that Crossrail
FIGURE 6
Tenure in Staines-upon-Thames
OWNED OWNED WITH PRIVATELY SOCIAL
OUTRIGHT A MORTGAGE RENTED RENTED
26.9% 36.5% 20.3% 16.3%
Source: ONS
FIGURE 7
Commute and travel time comparison
STAINES-UPON-THAMES WEYBRIDGE WINDSOR CHERTSEY VIRGINIA WATER EGHAM
FASTEST TRAIN TO LONDON FASTEST TRAIN TO LONDON FASTEST TRAIN TO LONDON FASTEST TRAIN TO LONDON FASTEST TRAIN TO LONDON FASTEST TRAIN TO LONDON
35 MINS 32 MINS 29 MINS 53 MINS 45 MINS 41 MINS
SEASON TICKET PRICE SEASON TICKET PRICE SEASON TICKET PRICE SEASON TICKET PRICE SEASON TICKET PRICE SEASON TICKET PRICE
£3,356 £3,824 £3,712 £3,824 £3,792 £3,584
DRIVE TIME TO DRIVE TIME TO DRIVE TIME TO DRIVE TIME TO DRIVE TIME TO DRIVE TIME TO
CENTRAL LONDON CENTRAL LONDON CENTRAL LONDON CENTRAL LONDON CENTRAL LONDON CENTRAL LONDON
53 MINS 60 MINS 55 MINS 58 MINS 57 MINS 55 MINS
DRIVE TIME TO DRIVE TIME TO DRIVE TIME TO DRIVE TIME TO DRIVE TIME TO DRIVE TIME TO
HEATHROW AIRPORT HEATHROW AIRPORT HEATHROW AIRPORT HEATHROW AIRPORT HEATHROW AIRPORT HEATHROW AIRPORT
9 MINS 16 MINS 14 MINS 14 MINS 12 MINS 10 MINS
4FOCUS ON: STAINES-UPON-THAMES RESIDENTIAL RESEARCH
2 is not expected to be operational until Valley Regional Park, a popular location
at least 2030. for walkers, runners and cyclists.
The Elizabeth Line will help to attract The local schools are also a draw. In
more businesses into the area, as will the borough of Spelthorne there are 28
plans for the Windsor Link Railway, a schools, of which 22 are rated ‘good’ or
14.2%
privately funded £200 million projected ‘outstanding’ by Ofsted. There are also a
that would provide a direct rail link from number of independents schools within
Staines-upon-Thames to Heathrow
a short drive of the town. Such a large
Airport, as well as improving connectivity
provision of quality schooling may appeal
to Windsor, Slough and Reading. The
to young families looking to move out of
line will potentially be in operation from
2022, subject to planning.
London in the search for more space. forecast house price
growth – South East
A local retail hub Outlook England, 2018-2022
The combination of affordability,
Staines-upon-Thames shares
a direct train link into London which takes
characteristics with surrounding towns
less than 40 minutes, a bustling high
that form London’s prime commuter
belt. Lining both banks of the River street, almost four miles of river frontage,
Thames, the town has almost four proximity to green spaces and Heathrow
miles of river frontage with homes, Airport will all continue to contribute
pubs and restaurants overlooking the towards Staines-upon-Thames becoming
river, interspersed by rowing clubs. an increasingly popular location for buyers
The town is on the edge of the Colne from London and further afield.
KEY FACTS
South East house price forecast Home-ownership: 63.4%,
2018-2022: 14.2% in line with UK average
Staines-upon-Thames Proposed £200m WindsorLink Average monthly rent, Private Rented Sector Stock
development pipeline: Railway, providing a direct rail link to two bedroom flat: £1,201 20.3%
756 new homes Heathrow Airport from 2022
Fastest train to London 3.82 miles of river frontage 144 homes have been purchased Best location in UK to
Waterloo: 35 minutes in Staines-upon-Thames in Spelthorne since April 2013, start a business in 2014
via the Help to Buy Equity Loan scheme
2 Schools in Staines-upon-Thames 347 net additional dwellings 20 minute drive to three 79% of schools in Spelthorne rated
rated outstanding were built in Spelthorne Crossrail stations (from 2019) good, very good or outstanding
during 2016-2017
Source: Knight Frank Residential Research
5KNIGHT FRANK
INTELLIGENCE
For the latest news, views and analysis
on the world of prime property, visit
KnightFrank.com/blog
RESIDENTIAL RESEARCH
Gráinne Gilmore
Head of UK Residential Research
+44 20 7861 5102
grainne.gilmore@knightfrank.com
Patrick Gower
Associate
+44 20 3640 7015
patrick.gower@knightfrank.com
LONDON RESIDENTIAL
Seb Warner
Partner
+44 20 7861 5426
seb.warner@knightfrank.com
Matthew Goldsworthy
Associate
+44 20 7861 5440
matt.goldsworthy@knightfrank.com
RESIDENTIAL DEVELOPMENT
David Jones
Partner
+44 148 361 7937
david.djones@knightfrank.com
Charles Dugdale
Partner
+44 20 7861 5411
charles.dugdale@knightfrank.com
Neil Haynes
Partner
+44 1494 689 226
neil.haynes@knightfrank.com
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The global perspective on prime property and investment
Headlines Dec 2017
UK house price growth has been
UK HOUSE PRICE FORECAST
LONDON All our clients recognise the need for expert
DEVELOPMENT
UK house price growth has moderated from recent peaks, although
slowing since the summer of 2014, markets remain highly localised.
although the annual change
remains positive
The momentum in house price growth is observed in the prime housing markets in LONDON SUPER-PRIME LETTINGS INSIGHT SPRING 2018
HOTSPOTS independent advice customised to their
slowing in many parts of the country, and London and beyond are set to continue,
Price growth across the UK is expected we expect price rises to remain muted and we explore this more fully in our blog.
to be 1.0% in 2018, reaching 14.2% overall next year amid increased economic The UK may now be entering a period of Price sensitivity in the sales market meant there was a record number of super-
cumulatively between 2018 and 2022 and political uncertainty in the run-up to interest rate rises, but even so, we expect prime tenancies in 2017. However, an anticipated recovery in sale prices means
Brexit and amid more muted forecasts for rates to be low compared to long-term there are more ‘try-before-you-buy’ tenants, as Tom Smith tells Tom Bill
In London, prices are forecast to fall by
wage growth. The market is localised and
we see slightly stronger growth in the
norms by the end of the forecast period.
While development levels are rising across
RESIDENTIAL DEVELOPMENT
0.5% in 2018, but cumulative price
Midlands, East of England and the North the country, the shortage of new homes is
There was a record number of super-prime compared to 11 in 2016. “There is increasingly
OPPORTUNITY AREAS 2018
specific needs.
growth over the next five years is tenancies agreed in London in 2017 as price- the opportunity to rent the sort of high-quality
West, a continuation of the trend that has unlikely to be fully reversed in the coming sensitivity in the sales market continued to boost
positive at 13.1% stock that has come from the sales market that
emerged this year. years, and that will underpin pricing. demand. historically did not exist on the lettings market,”
Once the Brexit deal is completed, we On the other hand, factors such as said Tom. “The clear message for landlords is Prince Albert Road, let, guide price £12,000 p/w
Some 137 properties were rented out at £5,000-
forecast rising momentum across the deepening affordability pressures and that super-prime tenants will not compromise on
plus per week last year, which represented a
THE WEALTH REPORT 2018
market, with price growth reflecting this in property taxes, will continue to weigh quality in the same way as buyers will not.”
34% increase on the figure of 102 in 2016. In the
many locations. The variations currently on pricing. three-month period between July and September The prime central London sales market is now
there were 49 transactions, which is a record for a moving towards recovery mode as higher
single quarter in 12 years of LonRes data. transaction costs are absorbed. Average prices
2017-2022 Forecasts, December 2017 above £10 million rose 0.2% in the year to
“The momentum of recent years is still gathering
pace,” said Tom Smith, Knight Frank’s head of January 2018, the first annual increase in almost
2017 2018 2019 2020 2021 2022 2018 - 2022
super-prime lettings. “Demand is resilient due to two years.
Mainstream residential sales markets
Kensington Palace Gardens, let, guide price £15,950 p/w
higher rates of stamp duty and the associated In a sign that more tenants are anticipating this
UK 1.5% 1.0% 2.0% 3.0% 3.5% 4.0% 14.2%
uncertainty over the short-term prospects for recovery, there has been an increase in the
London -1.0% -0.5% 2.5% 3.0% 3.5% 4.0% 13.1% price growth in the sales market. A lack of clarity number who have requested a clause in the
North East 2.0% 2.0% 2.0% 4.0% 3.0% 3.0% 14.8% regarding Brexit has also been a factor.” tenancy agreement giving them first refusal to Super-Prime Lettings Team
North West 2.0% 1.0% 2.0% 4.0% 4.0% 4.5% 16.4% As well as more transactions, the deals agreed buy at the end of the tenancy. The Knight Frank Super-Prime Lettings team
Yorks & Humber 0.5% 1.0% 2.0% 3.0% 3.0% 3.0% 12.6% are now on a longer-term basis as renting “This option was rarely mentioned a few years
provides a bespoke service to clients with property
becomes more accepted as a tenure model in interests of £5,000-plus per week in prime central
East Midlands 4.5% 2.0% 2.5% 2.5% 3.0% 3.5% 14.2% ago but is now a frequent topic of conversation
the super-prime market, said Tom. The average London. Led by Tom Smith, the team consists of
West Midlands 4.5% 2.0% 2.0% 3.0% 3.0% 4.0% 14.8% on viewings. Many landlords have nothing to
length of a tenancy in 2017 was 589 days, which 12 local specialists with over 130 years of collective
lose with this ‘try-before-you-buy’ route,” says
Methodology Statement: East 1.0% 2.0% 3.0% 3.0% 4.0% 3.0% 15.9% compared to 548 in 2016 and 528 in 2015, an experience and has a dominant market share in
Tom. “The worst case scenario is that you have
House price forecasts are based upon time series
South East 3.0% 0.0% 2.0% 3.0% 4.0% 4.5% 14.2% analysis of Knight Frank data shows. London. It completed twice as many super-prime
regression analysis of relevant statistically significant an income stream that covers your costs and
macro-economic variables adjusted in-house to lettings deals in London as its nearest competitor
South West 4.0% 1.0% 2.0% 2.5% 3.5% 4.5% 14.2% There was also a record number of £15,000- the best is that you also have a sale at the other
encompass externalities such as likely risk factors. in 2017, LonRes data shows. The team members
The forecast uses the Nationwide House Price Index
Wales 1.5% 1.5% 1.5% 2.5% 3.0% 4.0% 13.1% plus per week deals last year, with 20 recorded end.”
as a base. Our forecasts assume a Brexit deal, but are based in Belgravia, Belsize Park, Chelsea,
with a two year transitional period. Hampstead, Hyde Park, Kensington, Knightsbridge,
Scotland 1.5% 1.0% 1.0% 2.5% 3.5% 3.5% 12.0%
FIGURE 1
Marylebone, Mayfair, Notting Hill, South Kensington
Prime residential sales markets London super-prime lettings volumes and rental values
and St John’s Wood. Knight Frank’s global real
Prime central London east 0.0% 0.5% 1.5% 2.5% 3.0% 5.0% 13.1% Total Transactions Average weekly rent Maximum weekly rent estate network gives the team access to London’s
most exclusive properties on and off the market.
Prime central London west 0.0% 0.5% 1.5% 3.5% 3.0% 3.5% 12.6% 50
£45,000 £45,000
“The market is localised and Prime outer London -1.0% 0.0% 1.0% 3.0% 3.5% 4.5% 12.5% 40 £30,000
£35,000
£29,000 £25,000 £30,000
we see slightly stronger £16,800 £15,000£18,500 £13,500
£20,000
Prime England & Wales 0.7% 1.5% 2.0% 2.0% 2.0% 2.0% 9.9% 30
growth in the Midlands, Tom Smith
East of England and the Residential rental markets 20 £10,000
Head of Super-Prime
North West, a continuation UK 1.2% 2.5% 2.5% 2.5% 3.0% 3.0% 14.0% 10 £8,000 Lettings
of the trend that has London 0.7% 3.0% 2.5% 3.0% 3.0% 3.0% 15.0% 0 £6,000
tom.smith@knightfrank.com
2018 emerged this year.” +44 20 7881 7730
Q1-2015
Q2-2015
Q3-2015
Q4-2015
Q1-2016
Q2-2016
Q3-2016
Q4-2016
Q1-2017
Q2-2017
Q3-2017
Q4-2017
Prime central London -1.5% 0.5% 1.5% 2.5% 3.0% 3.0% 11.0%
12th Edition For the latest news, views and analysis Prime outer London -3.5% -1.0% 1.0% 2.0% 2.5% 3.0% 8.0%
on the world of prime property, visit
our blog or @kfintelligence
Source: Knight Frank Research
NB. Price forecasts are for existing homes. Property values in the new-build market may perform differently. Source: Knight Frank Research / LonRes AREAS TO WATCH PRICE FORECASTS MARKET UPDATE
The Wealth Report UK Housing Market London London Super London Development
2018 Forecast - Dec 2017 Prime Lettings 2018 Hotspots 2018
Important Notice
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RESIDENTIAL RESEARCH
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for general information only and not to be relied upon in
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the preparation of the information, analysis, views and
SPRING 2017
ALONG THE ELIZABETH LINE 2017
HOUSING
MARKET UPDATE
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