This article is an external press release originally published on the Landlord News website, which has now been migrated to the Just Landlords blog.
Buyers have flocked to purchase flats in the latest Canary Wharf development, with hundreds of flats selling in the opening five hours of going on sale.
The Maine Tower skyscraper in the east of the capital saw a flurry of purchases from both overseas and domestic buyers.
Maine Attraction
Boasting deluxe elite lifestyle living facilities and an all-private tower, the complex has no apartments for social housing. With 41 floors, prices start from £350,000 for a studio, rising to £1.25m for a three-bedroom flat. [1]
At the launch event for the complex, in excess of 200 apartments were purchased, totalling a combined £140m. Remarkably, these apartments sold in just over four hours, equating to £580,000 worth of sales per minute. Even more remarkable is that the development will not reach its conclusion until 2019.[1]
Flats were sold to both homebuyers and investors. However, 67 swanky flats and penthouses, with stunning top floor views of the capital, will go on sale at a later date.
David Galman, sales director at Galliard Homes said that the, ‘volume and speed of sales at the Maine Tower launch was incredible and shows the confidence that buyers from both the UK and overseas currently have in the London market.’[1]
Maine Tower rooms sell quickly
Demand
Values of London housing stock have constantly climbed over the last five years, rising by £563bn, or 61%. As such, developers are keen to cash in on the increased demand. 54,000 homes are planned to be built in prime areas of the capital, with the majority costing over £1m.
Looking at the profiles of buyers purchasing rooms in the Maine Tower, Galliard said some purchases were made by parents for their children, while a number of overseas buyers bought more than a single apartment.
Maine Tower is to be the tallest of five residential buildings in the Harbour Central development in the Docklands. The tower is to have a gym, a cinema and its own library. Property prices in Tower Hamlets, where Maine Tower is located, increased by 13% in the twelve months to May, with average prices nearly £500,000.
Overseas interest
A leading property expert believes developers sell properties such as those in Maine Tower in order to finance the overall completion of the buildings being sold off. Henry Pryor feels that, ‘to do this, developers will pre-sell some properties, but these can only be bought by people who don’t need a mortgage-a mortgage offer only has a six month shelf life.’
‘The biggest market of cash buyers for these kinds of properties are overseas, so this is where the developers, agents and lawyers go booking hotel lobbies in foreign capitals and selling what is really a sterling currency option dressed up in bricks and mortar,’ Pryor continued.
He added that the rental returns that investors could make were low, and as such, this could be the final time overseas buyers hurried to purchase property in London in this way. ‘Markets move and the time will come when the international buyer is no longer in awe of London and ceases to see the merits of owning 1100 sq ft of soulless real estate thousands of miles from home,’ he concluded.[1]
[1] http://www.theguardian.com/money/2015/jul/13/canary-wharf-flats-maine-tower-overseas-buyers
