House prices around Nine Elms and Battersea Power Station are forecast to rise by 25 per cent over the next five years following the opening of the Northern Line extension this morning. Rents are set to climb by 14 per cent too.
The promise of a 14-acre linear park and shopping centre, the zone one location and the Northern Line extension will propel house price inflation in that area higher and faster than others which have previously benefitted from a tube or train line extension, according to experts.
The extended track connects the two new housing estates, Battersea Power Station and Nine Elms, via two step-free stations of the same names, with the existing line at Kennington. Initially, the new service will run six trains an hour at peak times.
Forecasts by the property group JLL show house prices in the Thames-side development increasing by three per cent by the end of this year. The rate of increase will gather pace and rise by 4.5 per cent next year and peak at an annual rate of 5.5 per cent in 2023 – just ahead of the average annual house price growth for London.
Rents will also rise: nudging up one per cent this year, before increasing by a further 2.5 per cent in 2022 and 3.5 per cent in 2023 and 2024.
Compared to pre-pandemic, rents are down by an average of 10 to 15 per cent due to the flight of tenants from central London during the lockdowns and the absence of international professionals and students, the JLL report reads.
Analysis by Savills also supports the case for rapid price growth. The agent predicts that the increase in values and rents should be more dramatic in Nine Elms than in Woolwich (after the DLR extension).
“One of the key differences between Woolwich and Nine Elms is the level of connectivity the area had going in. Even before the DLR extension, Woolwich was on the Southeastern route into Kent. By contrast, the old Nine Elms rail station closed back in the 1960s. We’ve found that you tend to get greater house price uplift with step-changes in infrastructure, rather than incremental improvements,” explains Lawrence Bowles of Savills.
Nine Elms. The new 15-minute city?
Even by redevelopment standards, Nine Elms is considered controversial. Its neighbour Battersea Power Station is the thoughtful restoration of the much-loved 19th century power station into homes and office space, turning old arches into restaurants and gyms and with a bustling promenade of shops and cafes. It’s already well-established with plenty of residents living there and a packed events calendar.
Nine Elms is still a vast building site which has, in the past, been criticised for the lack of an holistic master plan and an oversupply of expensive apartments.
The collection of developers, led by the Hong Kong-based R&F, hope the 14-acre linear park which connects Battersea to Vauxhall Cross and a network of walkways, cycle paths and green spaces will help to win over the sceptics. There is a new shopping centre due to open in 2022 as well.
Nick Whitten, head of residential research at JLL, says Nine Elms could be “an archetype of the 15-minute city concept” where people can access all they need and want within a 15-minute walk or cycle.
“Shifting priorities as a result of the Covid-19 pandemic have re-emphasised people’s desire for vibrant, social and attractive communities in which to live. Placemaking is an increasingly important element of residential developments as the importance of location wanes,” Whitten says.
Where to buy? If you have the budget
Once completed Nine Elms will deliver close to 20,000 new homes in the stretch the size of Monaco that straddles Lambeth, Wandsworth and Vauxhall.
Its architectural showpiece (so far) has been the sky pool: the glass-encased swimming pool which stretches between apartment blocks 35m in the air. However, this could be overshadowed by the newest tower to be launched. The 53-storey building (known as No.8) is the first of 12 in One Thames City – the dominant development that sits at the Vauxhall end of Nine Elms.
The scheme will deliver 1,400 homes when completed with 298 of them in No.8, on top of podium gardens, with a wellbeing suite, sky lounge (on floor 39), a karaoke room and private dining. Prices range from £997,500 to £4,660,000 (via JLL on 020 7087 5111).
There are apartments available in Battersea Power Station itself for £865,000 (020 3912 0137) so buyers must look to the lower profile projects for more realistic prices. The Prince of Wales Drive has one-bedroom shared ownership homes available via Rightmove for £150,000 for a 25 per cent stake, with car club membership. The apartment block is just 180m from Battersea Park at the other end of Nine Elms (site-sales.co.uk).