Savills Elmbridge Home Truths

Tuesday 22 September 2020

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1 Welcome

Andrew Perratt Frances Clacy Simon Ashwell Charlotte Baylis

Head of Country Residential Head of Weybridge and Head of Esher Residential Research North Surrey Residential Lettings

[email protected] [email protected] [email protected] [email protected] 020 7016 3823 020 7409 5905 01932 838 004 01372 461 907

2 Q&A Panelists

Louis Winterbourne Karl Matier Trevor Kearney

Head of Head of Country House Cobham office Esher office Department

[email protected] [email protected] [email protected] 01932 586 200 01372 461 903 020 7409 8872

3 UK Residential Update Frances Clacy Residential Research

4 What differentiates the current situation from previous downturns?

Furlough House price scheme and growth in the mortgage run up to the holidays have crisis has been protected modest homeowners Expectation of a Interest rates and buyers v-shaped are at an downturn and unprecedented recovery (albeit low, but LTVs a deep & have tightened possibly lopsided one)

Source: Savills Research 5 The economic outlook - GDP

15% +11% Sharp economic contraction in 10% Q1 2022 H1 2020

0% Unemployment to rise, but still lower than post-GFC

-5% Annual real GDP growth GDP real Annual

-10% -10% Q4 2020 Interest rates -15% lower for longer

Source: Oxford Economics 6 The economic outlook - unemployment

7% 6.5% Sharp economic 6% Q4 2020 contraction in H1 2020

4% Unemployment to rise, but still 3% 4.0% lower than post- Q1 2023 GFC

2% Unemployment rate, ILO definitionrate, ILO Unemployment

1% Interest rates 0% lower for longer

Source: Oxford Economics 7 The economic outlook – base rate

0.8% Sharp economic 0.7% contraction in H1 2020 0.6% 0.1% 0.5% Until Q2 2024 0.4% Unemployment to

Base rate Base rise, but still lower 0.3% than post-GFC

0.2%

0.1% Interest rates 0.0% lower for longer

Source: Oxford Economics 8 Strong bounce back at the top end

Properties marked as Sold Subject to Contract Whole Market £1m+ 250% 227%

195% 200%

150% 132% 132% 112% 111% 103%

100% 88% 91% 91% v same month last year lastmonth same v

50% 37% 26%

0% Sep-19 Oct-19 Nov-19 Dec-19 Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20 Jul-20 Aug-20

Source: Savills Research using TwentyCi 9 Lockdown has driven a change in buyer requirements

56% 66% 57% 48% 62%

said the amount of those said a separate said of garden or more inclined to anticipate that space to work accessibility to outside space work from they will do so from home had Wi-Fi had had become home in the for 3+ days a become more become more more important future week important important (80% of the under 40s)

Source: Savills Client Survey August 2020 10 Local values

£782k Average value for Elmbridge 20% £1m+ transactions 4.6% £2m+ transactions

Source: Savills Research using Land Registry 11 Prime price movements

All prime UK (excluding London) Cobham, Esher & Weybridge 25%

20%

15%

10%

-5% Annual price movementpriceAnnual

-10%

-15%

-20%

Source: Savills prime regional index, Q2 2020 12 Prime price movements

All prime UK (excluding London) Cobham, Esher & Weybridge 25%

20%

15%

10%

-5% Annual price movementpriceAnnual

-10%

-15%

-20%

Source: Savills prime regional index, Q2 2020 13 Prime price movements

All prime UK (excluding London) Cobham, Esher & Weybridge 25% Annual 20% growth 15%

10% +0.6% 5% All prime UK 0% (excluding London)

-5% Annual price movementpriceAnnual

-10% +2.3% Prime Cobham, Esher & -15% Weybridge

-20%

Source: Savills prime regional index, Q2 2020 14 Cobham, Esher & Cobham, Esher & Weybridge Weybridge £1.5m+ -5.2% -12.0%

Since 2014 SDLT change Since 2014 SDLT change

Source: Savills prime regional index, Q2 2020 15 But what of the SDLT holiday?

FTB saving as a % of purchase price Other saving as a % of purchase price 3.5%

3.0%

2.5%

2.0%

1.5%

1.0%

as a % of purchase price purchase % of a as Potential stamp duty savings,duty stamp Potential 0.5%

0.0%

Purchase price

Source: Savills using Land Registry 16 Looking forward

1 Buyers and sellers will need to remain pragmatic

• Unwinding of government support & Brexit will make it difficult to sustain 2 current momentum

• The easing of international travel restrictions is particularly important for certain 3 markets

4• Mortgage debt remains incredibly cheap but is proving difficult to access

5• The wider tax environment may act as a drag on future price growth

Source: Savills Research 17 And for the prime rental markets across the commuter zone

Increased Tenants seeking Demand for tax & more space best in regulation class

More try More demand before you from Londoners buy tenants

Lower levels of Low stock Strong demand corporate levels for family demand houses

Source: Savills Research 18 Cobham, Esher & Cobham, Esher & Weybridge rents Weybridge rents

+0.3% -1.3%

Quarterly Annual

Source: Savills prime regional lettings index, Q2 2020 19 Thank you

21 Our market

Buyer Sales New Viewings Buyers from registrations agreed Instructions arranged London +102% +117% +411% +81% +152%

Source: Savills data August 2019 v August 2020 22 . 96% of guide price achieved (same pre & post lockdown) Our market 2020 . Buyers with London postcode rose from 27% pre-lockdown to a staggering 68% post-lockdown

. Number of sales in St George’s Hill up 63% compared to the same time last year

. In 2020 Cobham office sold 19% more property valued below £1.75m than in 2019

. 54% of our sales generated multiple offers

. Esher office arranged an incredible 188% more sale in August 2020 than the previous year

23 Orchard Gate, Esher: Guide £1.45 million

. Launched 7th Sept

. 9 viewings booked in three days

. Sale agreed in excess of asking price

. Client was able to secure their onward purchase

Birds Hill Rise, Crown Estate: Guide £3.95 million

. Local buyer

. Sold off market prior to build completion

24 The pull of the Private Estate

Ashley Park Guide £3.45m – Competitive bidding London v Local

Burwood Park Guide £4.95m – Competitive bidding London v Local

Burwood Park Guide £4.45m – Competitive bidding International v Local

St. George’s Hill Guide £3m – Competitive bidding London v Local

25 The pull of the Private Estate

Burwood Park Guide £1.85m – Esher buyer

Ashley Park Guide £1.45m – Walton buyer

Southfield Place Guide £1.05m – Weybridge buyer

St. George’s Hill Guide £2.15m – Cobham buyer

26 What does £1m buy you in…..

Wootton Cottage Vincent Road . 4 bed detached . 3 bed detached . 1,735 sqft . 1,607 sqft . £605 psf . £653 psf

Weybridge Cobham

Grapes House Moore House . 4 bed terrace . 1 bed flat . 1,885 sqft . 758 sqft . £581 psf . £ 1,385 psf

Esher London SW1

Source: Savills 27 The power of competition

54% of sales were the result of multiple offers.

Mizen Close, Cobham Garden Cottage, Leatherhead The Grange, Walton on Thames

Sold before formal launch of marketing Sold within 10 days of launching onto Launched on Thursday campaign the market

16 viewings on Saturday Offer agreed in excess of the guide 4 buyers offered price 8 offers Sealed bids

Sealed bids Sold in excess of the guide price

Sold in excess of the guide price

Guide £1.695 million Guide £1.695 million Guide price £1.050 million

Source: Savills 28 Is it all good news?

Number of apartments for sale

. Weybridge 281 . Walton on Thames 207 . In total 1,552 with 3 miles of Weybridge High Street . Best in class will sell

Source: Savills 29 Summary . Buyer demand started rising January 2020

. Pent up demand with London families moving out rose sharply after lockdown

. Gardens, privacy and office space key

. Less need for easy commuting

. Access to schools important

. St George’s Hill slowly recovering as available stock level decreases

30 Elmbridge Lettings Charlotte Baylis Head of Esher Lettings

31 The market so far

March – September (2019 vs 2020)

Volume of new applicant registrations (+47%) Volume of viewings (+14%)

Number of Relocations from London (+18.5%) Average Asking Price of Deals (13.6%)

Number of Corporate searches (-50%)

Minor Trends/Points of Interest

• Rent reductions and Country Retreat demand • Incredible appetite to move at the earliest opportunity (video viewings) • New or recently refurbished homes most desired • Demand outweighing supply across all price points • Most competitive price point has been family homes sub £3,500 pcm • London movers bolstering less corporate demand

32 Lifestyle movers

The Fairway, Weybridge Leys Road, Crown Estate

33 Price is Key

Albany Close, Blackhills St Georges Hill

34 Looking forward

Best in Class Size is Key Pet-Friendly

lll 66

Flexibility Corporate Services Stock Levels

66 4

35 Thank you

36 Q&A