A number of luxury homes are in the works across London, but market watchers warn that these projects could end up falling severely behind schedule as investors struggle to secure available contractors to keep up with rising consumer demand. Approximately 1,300 luxury homes, costing at least GBP 1,350 per sqm, are set for completion in London this year, according to EC Harris.
“With the UK economy back on track and London deemed a safe haven for international property investors, it’s not surprising that demand for luxury homes is fuelling ever-increasing development,” said Mark Farmer, who heads the residential team at EC Harris.
However, there is a shortage of qualified construction crews, which could impact delivery of these high-end projects, worth an estimated GBP 60bn. “There is simply not the capacity out there to meet demand and many projects will undoubtedly fall by the wayside or experience delivery difficulties due to sheer lack of resources,” Farmer said. “Many developers and investors, when in a position to do so, are therefore looking to jump the queue and are paying premiums for construction so they can deliver on promises they have already made to their purchasers.”
