Waitrose effect on house prices and the coming of Foxtons 1.5 out of 5 based on 2 votes.

Having the posh supermarket nearby is said to raise property prices but what happens when people can't afford to live in an area any more?

What would you rather live next door to: a Waitrose or a Foxtons? It's a bit of a misleading question; the impact of either spreads far beyond the houses next door to them. And if you were talking literally about your doorstep, you'd live next to anything that didn't sell kebabs.

No, this is a story about an extreme housing situation, in which gobbets that would have been more like a cute talking point in the 90s now probably sound somewhat less cute, unless you're a buy-to-letter.

At the start of the week, Savills – the international estate agent (that detail will be salient later on) – released research which said that having a Waitrose nearby was a significant boost to property prices. "It's a nice little story," said Dan Crofton, editor of PrimeResi, "but I think it's more likely that Waitrose follows affluent consumers, rather than that housebuyers are basing their decision on the local cheese counter." How do you sniff out affluence in an area? Crofton explains: "See how much people are investing in their properties. Lots of skips, adverts for specialist basement companies, planning notices." Other bits are less obvious – "have a look at the bicycle brands chained to the railings too – ideally, you're looking for any type of Pashley." You can tell they are posh because there are no prices on their websites.

The thing about the Waitrose effect is that it's huge in London – a 50% difference between Waitrosed-areas and non-Waitrosed areas – but less marked in the south-west and east of England, possibly, the research concluded, "due to higher average values overall". But that doesn't stack up, since London property prices outstrip those of any other region. More salient is the fact that parts of London remain that are significantly … well, you can choose between "undervalued", "unyuppified" and "ungentrified", depending on your age and class and leanings. Suffice to say, they all mean "not as insanely out of proportion to wages as other places in London".

And that's what's changing – because on the flipside of this property story is the Foxtons affair. In March, Foxtons opened branches in Brixton and in Mare Street, Hackney. There was immediately graffiti ("yuck" and "yuppies out"), but that, said Ben, who has worked for the company for some time, always happens. "We got the same thing in Shoreditch." There was some paint-splashing when Brixton celebrated the death of Margaret Thatcher, but recently, there have been protests outside specifically about rising rents in the area. That's when the Brixton branch installed two bouncers, although there were none there yesterday.

"For me, it's affordability," Ben continues. "When you look at Battersea and Clapham, affordability has completely dropped off." This would make it a classic yuppie spillover, except … "it's actually not so much young professionals, it's foreign investment, buy-to-lets. The pound is so weak. For someone who's buying in yen, there's probably a currency trade of 50 grand on a half-a-million-pound property. And rents are so strong because of the housing problem."

It's so interesting, this – a decade ago, we used to use May Day to protest against globalisation, but I don't remember thinking, Londoners are going to be in the eye of this; they're going to see themselves priced out of their homes by international currency fluctuations, and all they'll be able to do about it is throw some paint at Foxtons.

Outside the estate agents, Lucretia and Nicole, both 16, are very against social housing. "I don't want to live in a council flat, ever," Nicole says, trenchantly, but they laugh off the idea that they could ever buy their own place. "I live with my gran," Lucretia says, "and she bought our place when she was 21. Can you imagine me buying a place when I'm 21?" They both intend to leave London.

Tracey, 37, has lived in Brixton for 16 years, in a private rental. "I've been on a pay freeze for three years, and last time the rent went up, it was by £100 a month. Where do you find that? For people like us, who are working full time and renting, it's like being in a revolving door. We can't save for a deposit because the rent keeps going up."

Lisa, 40, adds, "Between us, we're earning good money. We should be able to buy, but we can't."

"This is the dear departed Margaret Thatcher – she ruined the housing situation. All those people in the Sun, saying, 'if it weren't for her, I'd never have been able to buy my council house'. That's the reason why nobody can buy any kind of house now," Tracey concludes.

Where I live, they've built a new Waitrose right next to the Iceland. Too weird. Who buys focaccia and arctic roll? Could Waitrose have made a mistake? Course not. It's impossible for this kind of company to make that kind of mistake. But when nobody can afford to live here, this whole globalised escapade might look like one giant mistake.

Zoe Williams

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source: http://www.guardian.co.uk/theguardian/2013/may/03/waitrose-effect-house-prices-foxtons


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