|Terraced House Prices in W12 Bounce Back in Summer|
16.4% rise helps overall average to coast to new record high
The average property price in W12 coasted to a new record high in the summer months, up by a very modest 0.7% to just under £700,000.
This rise - from £693,834 in the previous quarter to £698,371 - was driven mainly by terraced houses. While the number of sales showed only small rise, from 38 to 42, prices climbed by a substantial 16.4%.
This meant a bounce back over the one million mark at £1,020,105 for the first time since the same period in 2014, when prices peaked at £1,057,037.
This bounce reverses the trend during the spring months, when the average fell by 7.1%, amid uncertainties caused by the general election.
With flats and maisonettes however, it was the opposite story, with prices sliding by 5.4% from £488,876 to £462,287.
However, as with other areas in the borough, the market in flats is strongly affected by the ebb and flow of sales in upmarket new developments.
And with the launch this autumn of the first 450 flats at the redeveloped Television Centre in Wood Lane, with prices expected to begin at around £500,000 and the last few remaining properties at Linden Homes' Parkside Place on Goldhawk Road available for upwards of £750,000, prices are unlikely to fall further in the coming months.
At the top end of the market, just five semi-detached and no detached properties were sold between July and September, which makes it difficult to detect any consistent trend.
The most expensive property sold during the period was a six bedroomed house in Emlyn Road which changed hands for £2,617,500.
The September figures from the Land Registry’s Market Trend Data survey show that London remains the country’s best performing area in terms of residential property price rises. The average price in the capital is now just short of half a million at £499,997 up by 9.6% over the last year. The average property value in England and Wales rose by 5.3% to £186,553. Monthly house prices up 1.0 per cent since August 2015.
The number of completed house sales in England and Wales decreased by 4% to 81,696 compared with 84,691 in July 2014. The number of properties sold in ngland and Wales for over £1 million in July 2015 decreased by 9% to 1,413 from 1,555 a year earlier. Repossessions in England and Wales decreased by 50 per cent to 471 compared with 943 in July 2014 with only 36 taking place in London during the month.
In October, 25% more chartered surveyors in London saw house prices rise according to the latest RICS UK Residential Market Survey, compared to a balance of 26% more in September, showing a steady increase month-on-month.
However, only 5% more chartered surveyors are expecting a rise in prices in the capital over the next three months – this is the lowest reading across the UK over this time period. Despite this, the twelve month view for the capital is still relatively strong with 53% more respondents expecting prices to increase.
Demand from potential buyers grew modestly across London in October with 7% more respondents seeing a rise in new buyer enquiries. Demand continues to considerably outpace supply and the number of new instructions decreased for the ninth month in succession, with 9% more chartered surveyors reporting a fall, contributing to the rise in prices in the capital. The supply of new listings to the UK market as a whole has been in decline since the start of the 2015 with a decrease in new instructions in London every month this year.
In the London lettings market, demand increased at broadly similar pace to that of supply in the three months to October, as new landlord instructions rose at the quickest quarterly pace since early 2014. Nevertheless, rental expectations remain strong and respondents continue to expect rents to rise over the year ahead. Rental growth in the London is anticipated to accelerate to an average of around 4.5% per year over the coming five years.
Simon Rubinsohn, RICS Chief Economist, commented, “It is hard to get away from the issue of supply when it comes to the current state of the housing market. The legacy of the drop in new build following the onset of the global financial crisis is now really hitting home with both the sales and letting markets continuing to show demand outstripping supply on a month by month basis. And if the five year projections from members regarding the outlook for both prices and rents is anything to go by, property is set to become even more unaffordable going forward making the governments focus of boosting to delivery of new homes absolutely critical.”
Changes to the tax regime have also had an impact in the top end of the market with the turnover of larger family houses in the area falling.
Adrian Gill, director of Reeds Rains and Your Move estate agents, said, “The Chancellor’s intimidating Stamp Duty remodel is still spooking the top end of the London market. Properties worth over £1.5 million have been hit with a stamp duty increase, currently set at 12% of the portion of the property’s value above £1.5m, up from 5% previously. As a result, sales of homes worth more than £1.5 million have fallen by 35% in Q3, compared to a year ago. This tax has really put the shackles on the prime market in the capital, as three quarters of these sales since January 2014 took place in London. “
The numbers below are subject to revision as is it usual that some properties are added late to the Land Registry's database.
Source: Land Registry
November 23, 2015