Agents in the seaside city expect more Londoners to head south as buyers and sellers stop sitting tight
Brighton and Hove is in the middle of festival season. The annual Brighton Festival — the largest arts festival in England, which this year is expected to attract half a million people to 150 events including music, theatre, dance and literature — is, for many, a celebration not just of the city’s vibrant cultural scene but the start of summer.
Local estate agents are also hoping this month heralds the start of a new season for property sales, after a year so far of pre-election jitters that have seen buyers and sellers hold tight.
The property market in the seaside city is inextricably linked to that of London. Marc Cox, of Mishon Mackay estate agency, estimates one in five buyers comes from the capital. The property services group Countrywide reports a sharp rise — from 35 per cent in 2011 to 58 per cent in 2014/15 — in the number of London buyers in Brighton and Hove who come from “inner” boroughs of the capital, such as Lewisham, Lambeth and Tower Hamlets.
“London homeowners in zones 2 or 3 have found their equity has grown substantially and are attracted to Brighton because they want to maintain their urban lifestyle and make the most of the disparity in property values. The typical homeowner making this move sells in London for an average of £820 per sq ft — or £520,000 for a two-bed flat — and buys in Brighton for an average £400 per sq ft — or £490,000 for a four-bed house."
Yet the political uncertainty that first took hold of London’s £1.5m-plus property market several months ago also spread 60 miles south, with sales in Brighton and Hove having largely dried up in the past three months. Land Registry data shows that annual growth leading up to February this year was 9.8 per cent — but since then prices have fallen 1.4 per cent.
It is far from a market in crisis. Property prices are up 18.9 per cent from their 2007 peak and the average property price of £265,858 is significantly higher than East Sussex’s average of £197,560, according to Hometrack. But agents have reported a severe lack of stock. “Brighton buyers and sellers are very similar to London ones and we’ve seen people hold off from putting their properties on the market due to pre-election nerves,” says Cox.
The election outcome, however, has already seen sectors of the property market react quickly and favourably, with central London agents reporting millions of pounds’ worth of property changing hands on May 8 and Savills is predicting a ripple effect to spread south to “commuter-belt areas”.
One particular beneficiary will be Brighton and Hove, thinks Katherine Watters, an associate at Knight Frank’s buying agency, The Buying Solution. “Brighton is likely to see a similar pattern of stock growth and resulting transactions as London as both buyers and sellers breathe a sigh of relief and return to the market. The immediate removal of the risk of a mansion tax should also be the boost needed to kick-start the prime country markets and the £2m to £5m bracket in particular,” she adds.
It is not just mid- to high-end buyers who have held back lately; vendors have also been playing a waiting game, particularly those with family homes. Paul Taggart, associate director of Hamptons International, usually sees a healthy flow of families moving into the area from London for a lifestyle change, good schools and easy commutability. Instead, he has seen “market stagnation” in recent months as “the result of sellers holding off coming to market until post-election”.
That looks set to change though. “Just a few days in to [David] Cameron’s re-election, we have had far more phone calls than usual requesting market appraisals, which could signal revived confidence in the housing market. We don’t envisage notable price increases, but a ready stream of willing sellers and buyers will now actively re-enter the marketplace,” says Taggart.
A typical spring would see activity among three types of buyers from London, according to Countrywide: commuters, upsizers and downsizers. The one-hour rail commute between Brighton and London Victoria sees one in four Londoners who move to Brighton continue to work in the capital. “Even taking into account the £4,000-plus annual season ticket, many zone 2 or 3 Londoners who come to Brighton are financially better off because of the move,” says Middleton, who feels that Brighton’s rail access to London, compared with other south coast towns, has had a direct impact on its development.
“Towns such as Worthing and Eastbourne are less popular with Londoners looking to move out of the capital and, as a result, they are 10 to 15 years behind in regeneration initiatives,” he says, referring to Brighton’s major public realm projects including London Road and the New England Quarter.
Commuters favour areas such as Montgomery Street in Hove, near both Hove and Aldrington rail stations, according to Countrywide. Three/four-bedroom terrace houses there cost £425,000 to £550,000. Upsizers in search of greater space and value for money head for places such as Wilbury Gardens or Ranelagh Villas, where semi-detached and detached four/five-bedroom houses cost £800,000 to £1.35m. In nearby Hova Villas, a short walk from the seafront, a six-bedroom Victorian villa is on sale with Mishon Welton for £1.14m. Those with truly grand aspirations might look at Lewes Crescent in Kemptown, whose Grade I-listed seafront townhouses, including a six-bedroom example that Savills is marketing for £4m, are considered to be among the best examples of Regency architecture in the country.
“The listed status of Regency buildings makes even minor changes difficult, but it is viewed by most buyers as a badge of honour rather than a hindrance,” says Tom Middleton.
Between politicians and performers, there is much to distract the Brighton-bound from the business of buying and selling houses this May. But this post-election summer may bring a different picture altogether, when the election’s hot potatoes have cooled and the seaside resort comes into its own.
• Prices in Brighton and Hove rose 24.5 per cent in the five years to February 2015 (In East Sussex the figure was 13.4 per cent)
• Average prices in central Brighton are £454,156 for houses and £234,644 for flats
• Brighton’s Kemp Town area and Hove’s Brunswick are dominated by Regency architecture from the early 19th century
• There are 34 conservation areas in the city and about 1,200 listed structures
£250,000 A large seafront studio flat on Marine Parade
£500,000 A four-bedroom terraced house in family-friendly Queen’s Park
£1m A three-bedroom flat in a Grade I-listed Regency building on the seafront
Zoe Dare Hall, 15/05/15, www.ft.com