Home prices around the Canary Wharf financial district climbed at the fastest pace in London in the 12 months through April as hiring by banks increased demand for housing in and around the city’s financial districts.
Values jumped 16.2 percent in the area from Limehouse to Beckton on the River Thames stretching north to Poplar, Knight Frank LLP said today by e-mail. That compares with an increase of 2.3 percent a year earlier. Homes in the City of London financial district and its fringes climbed 15.7 percent.
“Such strong price growth is built on the improving U.K. economy and the fact that banks are hiring again,” said Tom Bill, Knight Frank’s head of London research. “When you add in rental income, you will struggle to find a prime residential market in London with a higher total return.”
In Tower Hamlets, the borough that includes Canary Wharf, 3,673 new homes were registered last year, more than any other London borough. Canary Wharf Group Plc, the company that controls the Canary Wharf office district, in March said it got permission to build a 58-story residential tower named Newfoundland. The homes would be the first to be constructed on the estate.
The housing markets in or close to London’s financial districts were sluggish after the credit crisis as banks cut staff and wealthy foreign investors opted to buy homes in the West End. Job vacancies in London’s financial-services industry climbed 67 percent in April as companies sought employees to manage increasing demands from regulators, recruitment firm Morgan McKinley Ltd. said yesterday.
Central London homes overall gained at an annual rate of 7.5 percent over the last three months, Knight Frank said. Properties in and around Canary Wharf had a total return of 21.7 percent in the 12 months through April, the broker estimates. Total return combines changes in real estate values and rental income.
New-home registrations in London rose to the highest in 26 years in 2013 as developers sought to capitalize on a shortage in the city, according to the National House-Building Council. Wandsworth had 2,136 registrations, the second highest after Tower Hamlets.
Oxley Holdings Ltd., a developer based in Singapore, plans to build 3,400 homes at Royal Wharf, close to Canary Wharf, after paying 200 million pounds ($337 million) for the site in November.
(An earlier version of this story was corrected to show data include neighborhoods surrounding Canary Wharf.)
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