London ranks as UK’s second home capital: Octane Capital



London ranks as the UK’s most popular place to buy a second home, says Octane Capital.

Secondary property purchases account for 29% of transactions in the capital and in some boroughs this climbs to half of all deals, according to data from the specialist lending firm. In London, this amounted to 35,100 transactions last year.

There were 230,800 second home transactions in the last financial year, which made up 23% of the housing market in England, says the firm’s analysis.

The study adds: “England’s housing market has been on fire for the last two years. Demand is high so prices are high and one reason for this is people buying additional properties. In fact, 10% of the population are thought to own an additional property, with the vast majority investing in a buy-to-let rental property.”

It found that the most active additional home market in London was Kensington & Chelsea where 1,200 second home purchases equate to 52% of all market activity in the borough.

Additional home purchases in Westminster accounted for 48% of all transactions, next came Camden and Harrow, both on 38%, followed by Brent on 37%.

The boroughs with the lowest percentage of additional homes are Waltham Forest, Lewisham, and Bexley, where these sales in each case accounted for 21% of market activity.

Across the country, the regions where additional homes account for an above average portion of the market include Yorkshire & Humber, 24%, the North West, 26% and the North East, on 26%.

Octane Capital chief executive Jonathan Samuels says: “Some may frown upon second homeowners, but the fact of the matter is that the vast majority are BTL landlords, not high-end homeowners restricting stock availability by purchasing rarely used holiday retreats.

So while almost a quarter of all transactions may be attributed to second homes, these purchases are serving a vital purpose, providing much-needed rental market stock to a nation that is becoming increasingly more reliant on long-term renting as a means of living.

Of course, there are exceptions to the rule and London’s prime market is certainly one of those exceptions. Across the likes of Kensington and Chelsea and Westminster, a higher propensity for second home ownership is undoubtedly being driven by wealthy homeowners increasing their own private portfolio, rather than investing in BTL opportunities.”