Oxford - Countrywide · With 2 in every 5 Oxford tenants living in an HMO, the introduction of HMO licensing in 2011 had a large effect on the Oxford rental market

Spring 2016

City focus series

Oxford

Warnborough RoadOX2 - £2.3 million

Park Town RoadOX2 - £2.6 million

Charlbury RoadOX2 - £2.7 million

Crick RoadOX2 - £4.9 million

St Margarets RoadOX2 - £2.1 million

OXFORD - CITY FOCUS SERIES

Buy RentAverage prices

and rents per month

£233,000 £915

1 Bed

2 Bed

3 Bed

4 Bed

£310,000 £1,100

£371,000 £1,300

£589,000 £1,700

Oxford in a minute

Oxford, best known for its world renowned university and architecture, attracts a mix of people from right across the globe. But the city is more complex than the picture of its dreaming spires.

Oxford’s neighbourhoods each possess

different communities, culture and

housing styles. The city’s transport

links make it well placed for commuters

looking for a more suburban lifestyle

within reach of London whilst accessing

some top schools. Oxford’s popularity

as a place to live combined with a lack

of new housebuilding has piled pressure

onto house prices in the city.

In 2015 average prices in Oxford grew

by 9% to reach 44% above their

2007 peak.

The size of Oxford’s booming rental

sector has grown by 59% in the last

10 years. Demand for rental

accommodation has come from hospital

staff, employees of BMW, and students

who account for 24% of the city’s adult

population alone. Much of the growth

in renting has been accommodated in

Houses of Multiple Occupancy (HMOs).

Oxford now has the largest proportion of

tenants living in the multiple occupation

homes of any city in the whole country.

With average homes inside the ring

road now costing £460,000, 15 times

the average income, Oxford is growing

increasingly unaffordable. With space at

a premium, the city’s growth has been

restricted. The surrounding greenbelt

land and floodplains mean land for new

development is limited. In 2014 only 50

homes were built in Oxford, which has put

significant upward pressure on prices.

Bicester

Kidlington

Greenbelt

Floodplain

2

WheatleyOxford city centre

Abingdon

Contents

Oxford in a minute02

Neighbourhood watch04

Oxford unlocked08

3

Where are Oxfords £1 million plus sales?

Oxford’s 5 most expensive roads

Postcode

71% OX2

14% OX3 9% OX1

6% OX4

CONTENTS

4

Average price £678,000

Average monthly rent £1,700

Price growth since 2007 +65%

Summertown flourished during the 1820s when

Oxford University released large tracts of farmland.

Today beautiful semi-detached Victorian and

Edwardian houses line the side streets, within easy

walking distance of Oxford town centre along the

canal. North Oxford is amongst the most expensive

parts of the city and prices have risen 10% in the

last year alone. Upmarket Summertown is a popular

choice for families relocating for some of the top

schools in the country as well as a chic high street.

Summertown, OX2




Oxford city centre is home to a large number

of impressive buildings, many of which are owned

by Oxford University. The historic nature of the

city centre and the amount of land owned by the

university means it looks much as it did a hundred

years ago and has only a small residential population.

This has started to change however with the

transformation of Oxford Castle from a prison into

a more open part of the city centre as part

of a mixed use development. The site now includes

a hotel, residential apartments as well as a selection

of bars and restaurants.

The City Centre, OX1

65%10%

8%

6%

6%5%

Where do people moving in to Oxford come from?

London

Cambridge

Scotland

Bristol

Reading

Birmingham

Over £500,000

Average price

£350,000 to £500,000

£300,000 to £350,000

£250,000 to £300,000

Under £250,000


5




Headington is a large residential area on London

Road, predominantly built during the 1920s around

the medieval village of Old Headington. As a result,

the housing stock is mixed and comprises both 200

year old cottages in Old Headington and the 1950’s

Wood Farm estate. The area is in high demand from

university students and medical staff, due to its

proximity to Oxford Brookes University and the John

Radcliffe Hospital. As a result there is large rental

market with heavy investor buy in.

Headington, OX3




Cowley is both a residential and industrial area

that was transformed in 1912 when William Morris

developed a car factory, which today is occupied

by BMW. The up and coming area which surrounds

the famous Cowley Road offers a mix of independent

bars, restaurants and shops enclosed by streets

lined with terraced homes, originally built for factory

workers. Property in Cowley is more affordable than

Headington, prices are currently 17% below the

Headington average. The area and its affordability

attracts first time buyers and young professionals

due to its proximity to the new Oxford Business Park

and easy access to the city centre.

Cowley, OX4

Rented

Owned outright

Owned with a mortgage

Household tenure

52%

24%

24%


Oxford unlocked

The rivalry between Oxford and Cambridge Universities extends beyond

its universities. Both cities compete fiercely with each other for growth.

Even since the late noughties, house prices in Oxford have increased

at a faster rate than Cambridge’s making Oxford one of the most

unaffordable cities in the country. Local employers, particularly hospitals

and schools have raised concerns that they are losing key workers as

affordability pressures rise.

Both Oxford and Cambridge have similarities beyond the fact they host

two of the most prestigious universities in the country. Both are wealthy

and attractive cities, within an hour of London and both are limited

by tightly drawn greenbelts. However, Cambridge built 800 homes

in 2014, nearly eight times the amount built in 2002, whereas Oxford

built just 50.

A needs assessment commissioned by Oxford Council in 2014 found

that Oxfordshire needs to build 32,000 new homes by 2031, with the city

itself allocated 10,200. Geographical barriers mean that the rest of the

housebuilding burden will fall on surrounding rural areas, adding

pressure to Oxford’s transport infrastructure. But with recent flooding

in the Iffley area, the council will be even less likely to grant planning

permission for developments near floodplains. However, they do appear

to be more open about developing on the greenbelt.

Oxford faces a challenge to deliver more homes and better

infrastructure. The new Oxford Parkway station and the Barton Park

development is a step in the right direction to boost the city’s growth,

but there is still some way to go.

6

Oxford versus Cambridge

Oxford v. Cambridge House Building 1990=100

“In 2014, Cambridge built 800 homes, whereas Oxford built just 50”

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

2012

2014

300

250

200

150

100

50

0

Source: DCLGCambridgeOxford

Oxford Parkway

Oxford Parkway station opened

in October 2015 in North Oxford,

just outside the ring road. Services run

twice an hour to Marylebone via

Bicester and take 56 minutes.

The station and new services will

reduce journey times and relieve

congestion. Chiltern Railways have also

announced their intention to re-open

the line from Cowley to Oxford

to passengers which would serve

to improve infrastructure links across

South East Oxford and relieve

congestion at Oxford Station which

is projected to reach capacity by 2019.

Eagle Works, OX2

The Eagle Ironworks was founded

in 1812 and overlooks the Oxford

Canal near trendy Jericho. In 2007

the ironworks were demolished

to make way for several large

apartment blocks. A number of units

were retained by the Ironworks

company and are now let out

privately. There are around 230 high

specification apartments in total with

underground parking and canal views.

Average price 2007 £283,500



Headington has long been a rental hotspot attracting buy to let investors

given its proximity to Oxford Brookes University and a number of hospitals.

However there has been a recent shift in demand with investors

focussing on the up and coming area of East Oxford and Cowley which

attracts students as well as professionals working in the nearby business

park. 40% of Oxford’s tenants live in Cowley, OX4 and the price gap

between OX4 and Headington, OX3 has narrowed. Both areas offer

attractive yields in comparison to the rest of Oxford and the additional

3% stamp duty tax announced in the 2015 Budget could see investors

increasingly looking for homes in these cheaper areas of Oxford.

With 2 in every 5 Oxford tenants living in an HMO, the introduction

of HMO licensing in 2011 had a large effect on the Oxford rental market.

Licensing was introduced to improve living standards for sharers whilst

preventing families being priced out of the market by limiting the number

of homes in an area which can be turned into HMOs to 20%. Strong

demand from university students and medical trainees have made

HMOs attractive propositions for landlords, offering yields

of 7% compared to an Oxford average of 4-5%. HMOs are concentrated

around Cowley, Iffley and Jericho due to their proximity to the

universities. The limit on the number of HMO properties allowed

in an area has meant that in some wards, homes that come with

a license carry a £40k-£50k premium.

12 Month Rental Growth

7

Rental dashboard

Renting in Oxford

Houses in Multiple Occupation

The Waterways, OX2

The Waterways was developed

on a brownfield site previously

occupied by the British Motor

Corporation factory. The development

is connected to Woodstock Road near

Summertown and offers a mix of flats

and houses. The large number

of homes meant the development

was phased with the first units going

on sale in 2000 while the last sale

didn’t complete until 2007.



Reliance Way, OX4

Berkeley Homes acquired the site just

off Cowley Road in 2004 from Oxford

Bus Company who had used it as their

main bus station for 80 years.

The development contains a mix

of flats and houses, with an additional

block of student accommodation built

in 2012. However, a recent

application to re-develop a former

Victorian hospital which borders the

site has been declined.



4.7%

4.8%

4.9%

5.0%

5.1%

5.2%

5.3%

5.4%

OX4 OX3 OX2 OX1

Days to let

23Average

tenancy length

16months

Proportion of lets made above asking price

14%


Aneisha Beveridge

Graduate Analyst

[email protected]

Authors

David Fell Research Analyst

[email protected]

Documents

Oxford - Countrywide · With 2 in every 5 Oxford tenants living in an HMO, the introduction of HMO licensing in 2011 had a large effect on the Oxford rental market