Family homes in demand as turnover in smaller properties collapses

A house in Mayfield Avenue was one of seven sold for over £2,000,000

The average sale price of a Chiswick property has reached a new record according to the latest official figures.

Land Registry data for the third quarter for sales in the W4 postcode area shows the level has risen by 29.8% over the year to £1,130,008.

However, with volumes currently so low, only 44 transactions have been recorded so far during the three months, it isn’t really possible to assert that this is representative of the level of property values in the area. The number of sales involving smaller properties has collapsed and, in what is believed to be the first time since records began, more houses were sold in the Chiswick area than flats and maisonettes.

During the pandemic so far, the turnover of larger family houses seems to have been maintained at levels comparable with those seen before but sales of apartments have dropped sharply with just 15 recorded so far. A greater proportion of larger properties being sold is the main reason for the rise in the average.

There have been seven houses sold for over £2,000,000 in Chiswick since the pandemic began. The top price paid was £2,800,000 for a semi-detached five bedroom house on Homefield Road. Other sales include that of a five bedroom semi-detached house on Mayfield Avenue with a landscaped garden which went for £2,500,000 having been listed for slightly below that back in 2018.

Paul Cooney, Director of Horton and Garton Chiswick said, “Traditionally Chiswick has a strong house market, it’s one of the top areas outside Zone 1 if you’re looking for a place to raise a family; excellent schools, an abundance of green spaces, a strong community and gorgeous family homes on quiet leafy roads are amongst the appeal factors.

“Many have reassessed their settings in 2020 and taken time to plan their next steps, it’s clear that the demand for houses in Chiswick is far greater than for flats – since the property market reopened on 13th May we’ve sold a staggering 25 family houses, a considerable number in just a short 6 month window that really demonstrates the shift in priorities.”

Julian Masson. Head of Sales at John D Wood & Co. on Turnham Green Terrace said, “Since returning from the lockdown period, we witnessed a surge in activity levels with a substantial increase in purchasers registering and new properties coming on to the property market. To put this in perspective, despite closing the office for a number of weeks during lockdown, year to date we’ve registered 26% more buyers in 2020 in comparison to 2019. The summer months and the beginning of autumn have been particularly busy for us and we saw a high demand from purchasers, providing a bubble of positivity amongst buyers and sellers.

“To give an example, we sold a beautiful house on Fairfax Road, Bedford Park which obtained multiple offers achieving 99% of its asking price. With the rise in people now working from home, we have also seen a rise in buyers moving out to the country with our Surrey and country offices recording a 68% increase of buyers registering with these offices in the same period last year. The RICS have warned that any boom could be short lived with the majority of estate agents in London predicting house prices to fall over the next year and mortgage availability has decreased as lenders play safe from the economic fall-out from Covid-19 with a substantial drop in products available for purchasers with added complications and stricter lender criteria. Although unsure with how much longer the buoyancy will last, Chiswick remains a sought-after and desirable location to relocate and has always proved to be very resilient. Despite the rise in people moving out of London to the country, more people in central locations seem to now be relocating to W4.”

Christian Harper of Harper Finn confirms this but suggests there may have been a recent slowdown. He says, “Booming marvellous! We have enjoyed a much more fluid and positive market over the past weeks. Unfortunately Lockdown v2 has applied the brakes though. Not quite equal to the stationary traffic on Chiswick High Road, more like a gentle slow down. Stock levels remain low which on the upside keeps buyers hungry as they don't have much to choose from.

“I have to say that this is the perfect market for me. It’s the time that I can tap into thirty years of Chiswick contacts. Most of the sales that I am currently agreeing are what I call ‘black book’. Not houses on the public market but generated from me putting worlds together. Clients that do want to sell but are not actively marketing. Introducing motivated private buyers exclusively to motivated private sellers has accounted for about 80% of my business in recent months and I think that this is the real future of our industry in months and years to come.”

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

It has been suggested that the stamp duty exemption has meant that higher priced sales are being expedited to be sure to complete before expiry of the incentive in March next year whereas the money saved on smaller properties is not as significant.

However, the small number of sales of flats recently does not point to a sharp fall in prices. Rather it is felt that buyers and vendors have found it difficult to agree on a price with the former expecting big discounts due to the current uncertainty and the latter unwilling to budge. Mortgage holidays have reduced the number of distressed sellers coming to the market for now.

Christian Harper doesn’t see an immediate recovery in this sector. He says, “While the house market has shown exceptional results over recent weeks which will be evidenced in Q4 Land Registry results, in stark comparison the apartment market continues to be very hard work. First Time Buyers are found in small numbers whilst the Investment Buyer has almost become extinct. The apartment market still remains relatively active at the higher price levels however substantial and continued economic confidence will be required before transaction number return to pre-2017 levels.”

Paul Cooney commented. “There’s a noticeable trend appearing here in W4; young couples are increasingly frog leaping the flat purchase, skipping a few steps on the property ladder and buying a house far earlier than they usually would. Largely in their late 20’s and early 30’s, these buyers have good salaries and can take advantage of borrowing currently being cheap due to historically low interest rates, and in many cases, family are facilitating the move by topping up their deposit. The current stamp duty holiday is the cherry on top.”

Nationally the Nationwide House Price Index showed a year on year increase of 5% to £226,129 up to the end of September. For London the average has risen by 4.4% over the year to £480,857.

Robert Gardner, Nationwide's Chief Economist, said: “Housing market activity has recovered strongly in recent months. Mortgage approvals for house purchase rose from c66,000 in July to almost 85,000 in August - the highest since 2007, well above the monthly average of 66,000 prevailing in 2019.

“The rebound reflects a number of factors. Pent-up demand is coming through, with decisions taken to move before lockdown now progressing. The stamp duty holiday is adding to momentum by bringing purchases forward. Behavioural shifts may also be boosting activity as people reassess their housing needs and preferences as a result of life in lockdown.”

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November 16, 2020