Sharp fall in sales of family homes likely to be reversed in coming months
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The recent election result is likely to bring renewed confidence in the local property market, according to agents who say there is now a "definite mood" to buy property.
Chiswick house prices appeared to have marked time in recent months with political uncertainty leading to a fall in the number of transactions and a reduction in prices. During the first quarter of this year the average price of a home sold in the W4 post code area was £817,126, a 10% reduction from the same period last year.
The main driver of the fall in the average was a sharp reduction of sales of houses (as opposed to flats). The number of semi-detached and terraced houses sold in the area halved compared with the same three months in 2014.
However, with uncertainty about a Mansion Tax and other proposals now put to rest with election of a Conservative majority government local agents how believe prices and activity will bounce back strongly.
Flats appeared to have maintained their good price levels throughout the recent months, with volume of flat sales remaining high. Prices for flats reached a new record level during the quarter with the average price reaching £563,625 up by 12.2% on the year.
The most expensive property reported so far as being sold during the quarter was a new build family house at Riverside Lodge on Chiswick Mall ,the former site of the Chiswick Maternity Hospital. It changed hands for £3,385,000.
Philip Pike of Faron Sutaria said; "Following the election, the early indications of higher activity in the property market are backed up by historic data from the 2001, 2005 and 2010 General Elections. The percentage increase in the number of properties sold in Central London in the six months after those general elections, compared to the previous six months, were up 25%, 37% and 16% respectively. As can be seen, historically there has consistently been a rise in property sales post-election, and it looks like this next six months is going to be no exception".
Alastair Hilton of Winkworth Estate Agents said, 'The property market likes nothing less than uncertainty, but that is what we have had for months and months with talk of mansion tax and massive changes to the lettings rules.
"Whatever your political views, there is now certainty that there will not be any big changes to the property market. Immediately after the election we started to see buyers coming back in force. There is a real confidence again from these buyers and we are sure to see a number of houses selling that have been sticking for too long. I'm predicting that prices won't necessarily rise, but houses will sell much quicker than they have for a while.'
Christian Harper of HarperFinn commented, "We certainly witnessed a dramatic drop in activity and prices across the entire house market in the first quarter of this year and I agree that this was caused by uncertainty linked to rumours of Mansion Taxes, rent caps and various other schemes to cover this country's inability to build quality houses to meet its growing population.
"However, as this election has shown, punditry about the future can be very inaccurate so on this occasion I prefer to simply report on what has happened since 7th May. I am delighted to say that the market is certainly beginning to release. New good quality stock at competitive prices has generated higher demand than we have seen for months.”
The Royal Institution of Chartered Surveyors (RICS) UK Residential Market Survey says that London house prices were back into positive territory in April, after seven months in decline, with short term predictions suggesting further rises.
28% more chartered surveyors saw prices rise in London in April, the first positive reading in the capital after seven negative months in the run up to the election. Price expectations over the next three months are also positive, with 11% more respondents expecting prices to rise further.
New instructions fell sharply with 36% more chartered surveyors seeing a decline, while the capital also saw an increase in buyer enquiries for the first time in a year as both these factors contributed to the pick-up in prices. Activity levels over the last month decreased most sharply in London where 21% more respondents reported a fall rather than rise in newly agreed sales
52% more respondents expect prices to rise over the next twelve months in London and the predicted average percentage price rise for houses in the capital over each of the next five years is 5.4%.
Meanwhile, in the lettings sector, supply has been rising steadily in London for three years now but the growth in tenant demand is not far behind. As a result, 39% more chartered surveyors expect rents to rise over the next three months which is the highest reading since the first half of 2011.
Simon Rubinsohn, RICS Chief Economist, said: “It is conceivable that the decisive outcome to the election could encourage a pick-up in instructions to agents and ease some of the recent upward pressure on house prices but it is doubtful that this will be substantive enough to provide anything more than temporary relief. Alongside an increased flow of second hand stock, it is absolutely critical that new government focuses on measures to boost the flow of new build.’’
According to Land Registry figures London as a whole continued to see the highest price rises in the country in March rising by 11.3% to £462,799. This compares to a 5.3% increase for England and Wales which brought the average price up to £178,007. The peak was achieved in November 2007 when the average reached £181,049.
The number of properties sold in England and Wales for over £1 million decreased by 19 per cent to 851 from 1,049 a year earlier. Repossessions in England and Wales decreased by 45 per cent to 590 compared with 1,081 in January 2014
London was the region with the greatest fall in repossession sales with only 65 taking place in January 2015.
| Chiswick Property Prices - (January - March 2015) | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Area | Detached | Sales | Semi-Det | Sales | Terraced | Sales | Flats/ Mais |
Sales | Overall Ave | Total Sales |
| W4 1 | 0 | 0 | 2950000 | 1 | 1070150 | 7 | 584125 | 8 | 944628 | 16 |
| W4 2 | 1100000 | 1 | 1547750 | 4 | 1116295 | 10 | 472956 | 8 | 966852 | 23 |
| W4 3 | 1690358 | 3 | 1920000 | 1 | 1022500 | 4 | 471870 | 20 | 732803 | 28 |
| W4 4 | 2110010 | 1 | 2090500 | 3 | 1359167 | 3 | 628571 | 14 | 1012334 | 21 |
| W4 5 | 0 | 0 | 953000 | 2 | 1003785 | 13 | 596674 | 45 | 696759 | 60 |
| Total | 1656217 | 5 | 1748955 | 11 | 1077587 | 37 | 563625 | 95 | 817126 | 148 |
| Change in Quarter | 45.8% | 0.0% | -4.3% | -42.1% | -2.7% | -41.3% | 0.3% | -1.0% | -8.9% | -19.1% |
| Change in year | -15.9% | 66.7% | 8.7% | -64.5% | -4.1% | -49.3% | 12.2% | -5.0% | -10.0% | -28.5% |
| Change in three years | - | - | 45.7% | -50.0% | 43.0% | -21.3% | 35.5% | 2.2% | 31.7% | -8.6% |
| Change in five years | 52.8% | 25.0% | 67.5% | -60.7% | 38.0% | -24.5% | 63.5% | 23.4% | 31.2% | -6.3% |
| Change in ten years | - | - | 147.5% | -52.2% | 127.2% | -19.6% | 115.3% | 4.4% | 103.6% | -10.3% |
Roughly speaking the post code sector areas are as follows:
1 - Bedford Park and the north side of the High Road
2 - The south side of the eastern end of the High Rd down to the river at Corney Reach
3 - The Grove Park area and over to Strand on the Green
4 - The west of Chiswick between the A4 and Chiswick High Rd - (a high concentration of flats)
5 - The north west of Chiswick - Acton Green mainly
May 18, 2015