With Apple expected to complete their move to the regenerated Battersea Power Station site by 2021, we’ve highlighted what impact this could have on the local property market in the London Borough of Wandsworth.
We looked at price change in Wandsworth and four other examples where big brand names had moved into a regenerated or existing area, bringing a large number of job opportunities with them. We then looked at house price growth since the arrival of each company and compared it to that of the country as a whole, as well as a period prior to their arrival.
Battersea Power Station
Since its final closure in 1983, the fate of Battersea Power Station has remained largely undecided. The first glimmer of hope came from the purchase of the site by Real Estate Opportunities in November 2006. In the six years prior to this deal, the average house price in Wandsworth had increased by a notable +77%, but +2% less than London as a whole.
Over the five years following the deal with REO, the intended regeneration helped to breathe new life into the Wandsworth market, with property values accelerating in growth by +16% – +5% higher than the London market overall.
However, in November 2011 the REO scheme collapsed and the site went into administration. Despite this, property values continued to climb across Wandsworth, increasing by +18% between the collapse of the REO scheme and the start of construction of the latest project, +4% higher than the London average.
But it would seem that those living and looking to buy in the area prefer the idea of regeneration over the actual implementation of it. Since work has begun on the site the average house price across London has jumped +46%, while across Wandsworth it has only managed an increase of +36%.
This said, with Apple committing to the site as the location of their UK HQ, this slower rate of increase could soon be reversed if other examples are anything to go by.
The BBC in Salford
The BBC’s decision to up sticks and move to Salford in 2011, bringing with them a host of job opportunities and existing employees looking for property, looks to have elevated the local Salford property market.
Since they started the move in May 201, the average house price in Salford has increased by +30%. When compared to England as a whole, this is actually -3% slower than the market across the rest of the nation.
However, when comparing the state of the market previously, the figures highlight what a monumental turn-around the regeneration of the dockland area and inhabitants such as the BBC have had on the local market.
In the four years previous to the BBC moving its HQ to Manchester, the average house price in England increased by +1%. Unfortunately for homeowners in Salford the local market suffered a drop of -9% during the same time. Although Salford house prices are still marginally trailing the rest of the country now, they have come from the depths of the property market to almost on par in just five short years.
Mercedes-Benz in Elmbridge
In the decade prior to the opening of Mercedes-Benz World in Weybridge, the average house price across Elmbridge increased by +198%.
This is a huge rate of increase but across England as a whole price growth rose by +226% during that same time period.
Between opening in 2006 and today, prices in the area of Elmbridge have increased by +76%, a +40% rise above the rate of increase across England (+30%).
McLaren’s relocation to nearby Woking has also had a positive impact to the local market. Since the McLaren Technology Centre opened in 2003, house price growth has exceeded the average across England (+82%) by +10%.
EA Games (Criterion) in Guildford
Comparably, EA’s Criterion headquarters in Guildford has brought a similar change of fortune to the local property market.
Although the presence of the company predates the recent and ongoing regeneration of Guildford town centre, property values in the area have increased by +44% since they moved into the town in 2007, +17% more than the increase across England (+27%) during the same time period.
But looking back over the previous eight years before they relocated to Guildford, the local market only saw an increase of +158% to the +195% enjoyed across England as a whole.
The regeneration of such an iconic landmark and the surrounding area is always going to impact the local market positively and, despite price growth slowing since work has started at Battersea, the area should soon overtake growth rates across London once it nears completion.
The commitment by Apple to move to the site will bring a huge boost. Not only will the job opportunities on offer help the local economy, but when big brands relocate to an area, it creates a ripple effect of desirability across the whole market, whether you work for them or not.
We believe that prices in Wandsworth will continue to increase until 2021, but once Apple arrives, the market should see a notable jump in values. Wandsworth could see property increase by as much as 40% between 2021 and 2025 so it’s worth getting on the ladder now as the rate of growth should once again surpass that of the capital as a whole.Russell Quirk