|Acton Property Market Holds its Breath for Brexit|
Hope that activity could recover once future becomes clear
Activity in the Acton property market remains subdued as buyers and sellers stand back in the hope of some resolution of the Brexit question.
The latest figures from the Land Registry show that just 89 sales were reported so far in the third quarter of this year. There has been a very sharp fall in the number of flats being sold with a 60%+ decline compared with the same 3 months of 2018.
The average price is down by 1.3% to £562,193 over the year but this masks a general decline in the market as the proportion of houses being sold has increased. The price for flats is down by 13.1%
Local estate agent Billy Rowe, director of Aston Rowe said, “Whilst many will assume the market is not moving at a great pace, there is in fact a healthy market of sales business being written providing the property is priced correctly, particularly in the house market where there is a limited supply of quality homes coming to the market. A decrease in the overall numbers of instructed properties on the market with some holding off selling until after Brexit, has led to a strong market for those coming on and some good prices have been achieved, despite market pressures.”
Larger family houses remain popular and buyers still appear keen when they become available. The top price paid during the quarter was £1,800,000 for a semi-detached property on Goldsmith Avenue.
Unlike in neighbouring Ealing, there appears to be a slow but steady demand for new build properties with developments such as the one at Colonnade Gardens seeing a number of units selling. There have been 79 new flats sold in the W3 postcode area so far this year compared to just 11 in Ealing (W5 and W13). Very few of these sales have been in Acton Gardens which may possibly explained by many of the units sold being classed as affordable and therefore not recorded in Land Registry figures.
Some local estate agents are expressing concerns about a potential glut across London with one describing the current property market as dysfunctional.
He said, "The market price flats in a development are a really hard sell at the moment particularly if there is no Help to Buy support. A big turn off for buyers is when a block has a high 'affordable' content. This isn't down to snobbery as most of the people in these units are professionals but people don't like to be in a position where they feel someone else is paying less for the same thing.
"There is always plenty of demand for the discounted units but they don't show up in the figures but the market price units are not moving. For the developer that is where the margin is so the market is thoroughly dysfunctional."
Billy Rowe is also detecting an increase in demand for houses in a lower price bracket. He says, “We have seen an upturn in demand for terraced and semi-detached homes under £1m as some prices have now reduced from previous highs, and many family buyers either see it as a good opportunity to trade up at the moment and there is some thought prices may have bottomed out.”
He concludes, “The market for sales of flats has seen increased competition due to many new build and converted properties coming to the market with many developers offering incentives and increasing their specifications to attract buyers. As Brexit looms there is a growing feeling that there is some pent up activity of sellers and buyers coming to the market post Brexit that may currently be holding off. There is no doubt transaction numbers have decreased and values have slipped back, but the question is have we reached the low point and will there be a mini revival Post Brexit?- My guess is there will be.”
The Land Registry House Price Index for August 2019 shows that overall prices were down by 1.4% in London which made it the worse performing area in the UK. For the country as a whole the average price rose by 1.3% to £234,853.
The Royal Institution of Chartered Surveyors’ (RICS) August 2019 UK Residential Market Survey reported a flat trend in demand (new buyer enquiries) at the national level, following a few months in which enquiries had increased modestly. Newly agreed sales moved slightly further into negative territory. Alongside this, new instructions to sell were broadly unchanged for the third successive report.
The Bank of England’s Agents‘ summary of business conditions – 2019 Q3 reported that the housing market continued to soften, reflecting deteriorating supply and demand. Estate agents reported softer demand in the secondary market, though demand for lower-priced properties was more resilient.
The UK Property Transactions Statistics for August 2019 showed that on a seasonally adjusted basis, the estimated number of transactions on residential properties with a value of £40,000 or greater was 99,890. This is 0.9% higher than a year ago. Between July 2019 and August 2019, transactions increased by 15.8%.
The Bank of England’s Money and Credit release reported that mortgage approvals for house purchase (an indicator of future lending) decreased in August 2019 to 65,500. This is down from the previous peak seen in July 2019 of 67,000 but remained within the narrow range seen over the past 3 years.
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November 7, 2019