Clapham offers something for everyone. Village vibes and green spaces border Britain’s busiest train station and three underground stations, offering locals unrivalled connections both north into the City and south into Surrey. As a result, students stay to put down roots, maturing into young professionals and even young families.
Sales
While some seasonality is returning to the market, buyers' Covid-induced shopping list remains true to this day. Clapham, offering all that it does, has seen average prices grow 14.7% since the start of the pandemic, outperforming Greater London.
With the average price of a home in Clapham rising to £878,500, SW4 is now the second most expensive postcode district in South West London.
Given the demand for space, flats continue to prove less popular. The average price of a flat in SW4 has reached £583,200, up 1% on 2021, but under-performing other property types. In fact, the average flat still costs 2.6% less than its 2017 peak, in line with most Inner London neighbourhoods.
Despite this, the market is still performing well. The average time to agree a sale on a property has dropped, down to 51 days on average in 2022, 7 days quicker than last year.
Due to a lack of homes available to purchase, buyers are increasingly facing bidding wars. This year, a record 34% of homes in Clapham sold above their asking price.
Households who move into Clapham, tend to stay in Clapham. Over half (56%) of movers in the past 12 months either came from within Clapham or it’s immediate neighbours. 89% of all purchases in Clapham were made by someone already living in the capital.
Despite the strength of the current market, there are risks on the horizon. Interest rate rises in the face of double-digit inflation may start to put limits on how much buyers can afford to pay - particularly those looking for their first home.
However, Clapham’s affluent demographic, proximity to the city and heavy buy-in from the bank of mum and dad, means the market is likely to be better insulated than many other corners of the capital.
Lettings
Inner London rents are seeing their strongest growth on record and outperforming anywhere else in the country. This year, the average rent in 13 of London’s most central Boroughs crossed the £2,500 mark with rents rising 35.1% year-on-year. However, this high growth is more of a return to form for Inner London, having been hardest hit by the pandemic.
As stock remains low and demand for extra space high, prices for prized larger properties with outdoor space have risen strongly. The average rent on a one-bed in Clapham has increased 8.9% over the last year, whereas rents on three and four bedroom homes have risen 16.5% and 18.6% respectively.
Rents have increased on the back of low stock levels alongside new licencing requirements in the area which classify any home with three or more sharers as a House of Multiple Occupation (HMO). The licence costs around £500 per bedroom and lasts five years. However, the level of demand from sharers in their twenties and thirties in Clapham means that a home let to multiple working professionals is likely to yield higher returns than the same property let to a single family.
Looking ahead, we expect rental growth to cool slightly from current record rates. This is mainly due to the cost-of-living squeeze, which will weigh on how much tenants can afford to pay. However, a shortage of stock will keep a floor under growth. By the end of the year we expect rental growth to slow across London to around 10%, down from 12% in July.
