|Ealing Property Prices Hold Firm as Sales Volumes Tumble|
Too few transactions taking place to get clear picture of Brexit impact
The latest numbers suggest Ealing property prices have been quite resilient so far this year. However, there is more confirmation of a marked slowdown in the number of transactions taking place in the local area.
There is no indication as yet of precipitous drops in property values in the latest figures from the Land Registry. Due to the decline in volume it is only really possible to make comparisons for terrace properties and flats. The average terrace property in Ealing actually rose in the second quarter of the year whereas the average price of a flat remained unchanged in W13 and declined by 5.5% in W5.
Although the number of transactions are likely to be subject to a later revision upwards, it is unlikely that this will be sufficient to change the overall picture.
The data is up to the end of the second quarter and therefore only includes a short period after the Brexit vote. Anecdotally the decline in transaction volume has worsened after that point.
The top priced property sold in Ealing during the quarter was a house on the North Circular changing hands for £1,550,000 which was more than likely bought as an investment property. It has been arranged to include three self-contained flats.
Since the end of the second quarter agents say that there are too few transactions taking place to reach firm conclusions about the market but many vendors have withdrawn their properties meaning there is an even more severe shortage of stock at the moment.
The top end of the market was very active in the first three months of the year as people tried to avoid Stamp Duty rises which drove the overall market in W5 to all-time highs. Three of the top ten highest ever prices were paid for houses in the W5 area, all above £3,000,000 between January and March. Since then there has been a corresponding lull in the market.
Across the whole of London Prices rose by 12.6% over the twelve months to June bringing the average price up to £472,204. Prices rose marginally during the month of June.
For the UK as a whole there was an annual price increase of 8.7% which takes the average property value to £213,927.
Following a strong increase in sales in March, UK home sales fell by 55.4% in April 2016, recovering slightly in May and June 2016. The swings in volume are believed to be primarily due to Stamp Duty changes. This was mirrored in London where 14,783 sales were recorded during March but this fell to 4,368 in April.
The latest report from the Royal Institution of Chartered Surveyors (RICS) has concluded that housing market activity has softened with sales and interest from new buyers continuing to wane. They say sales and enquiries continue to display a negative trend in London - although expectations point to a more stable picture in the coming months. Stock levels in the capital are at record lows and new instructions have declined markedly. Across London, 42% more surveyors reported a fall in transactions; the fifth month of decline.
The RICS say that this reflects a continuation of a trend that started in March following the implementation of the tax surcharge on investment purchases. Anecdotal reports provided by contributors to their survey suggest both the tax change and the ongoing fall-out from the EU referendum are contributing to the current mood in the market. However, looking a little further out, London has seen a notable turnaround in sentiment for the year ahead, as confidence towards the outlook for transactions climbed to a seven month high.
Simon Rubinsohn, RICS Chief Economist, commented: “The housing market is currently balancing a raft of somewhat mixed economic news alongside the latest policy measures announced by the Bank of England, which have already begun to lower cost of mortgage finance. Against this backdrop, it is not altogether surprising that near term activity measures remain relatively flat. However the rebound in the key twelve month indicators in the July survey suggest that confidence remains more resilient than might have been anticipated.“
In a forthcoming edition of the EalingToday.co.uk newsletter there will be a complete listing of recent property sales in the area. To register to receive it click here.
Source: Land Registry
August 18, 2016