London’s New-Build Market Sees Momentum Building After Election Slowdown

Image: New homes in London

Demand for new-build homes in London has started to pick up momentum after a slowdown in the run-up to and immediately following the General Election, according to recent research.

Analysis by Knight Frank found that while the total number of offers made on new-build homes in the capital fell by around 50% in June and July compared to the same period last year, viewings only eased by 10% over the same period.

This drop in activity was reflected in the broader London housing market, with new offers falling to their lowest level since 2012, according to Knight Frank Research associate Anna Ward.

“The election caused activity to drop off across the broader London housing market, with new offers falling to their lowest level in June and July combined since 2012,” she said.

However, recent data suggests that this slowdown may be coming to an end, with viewings starting to pick up again and weekly offers made recovering to 2023 levels.

Domestic demand for new homes has picked up in the first half of 2024, supported by an uptick in international buyers, Knight Frank said.

Currently, buyers are focused on well-located central schemes in London, such as One and 10 Park Drive in Canary Wharf, which have just 56 one or two-bed apartments remaining out of a combined 830 private units.

Image: One and 10 Park Drive in Canary Wharf

Off-plan sales have also accounted for a significant proportion of new homes sold in London, making up a third of all new homes sold with Knight Frank in the first half of 2024. This is up from a quarter in the same period last year.

However, the concept of buying off-plan is less familiar to most UK buyers, who typically prefer to view the completed product before making a decision. Uncertainty over mortgages has also led some to hold off buying until a later stage.

This, combined with the fact that developers have slowed down their build-out rates as demand has reduced, means that options for completed homes are more limited in some areas.

Outer London has seen a significant fall in unsold finished homes, from a peak of just over 2,100 in Q4 2019 to 1,030 in Q2 this year.

Image: Unsold finished homes in Outer London