Stamp Duty Holiday Fails To Boost Ealing Property Market
Low turnover and falling rents bringing concern for future
Sales figures released for the last quarter of 2020 present a generally grim picture for the local residential property market with turnover levels lower than were seen during the financial crisis or earlier during pandemic.
In the W5 postcode area the average price fell sharply from the levels seen in the previous three months down by 19.9% to £731,162. The earlier quarter had seen the average inflated by a number of big ticket house sales. Over the past year the average in this area is up by 3.1%
The highest price paid for a home was on Grange Road where a five bedroom detached house changed hands for £2,750,000. This had been bought for £1,700,000 in December 2009.
Postcode area W13 (West Ealing) was more robust with the average increasing by 29.8% to £857,532. This is entirely due to the change in the proportion of flats to houses sold. On a like for like basis prices appear to have been broadly unchanged.
Family houses in West Ealing continue to see robust demand with seven out of the 28 properties sold in the area during the final quarter selling for over a million. The top price paid was for a house in Culmington Road which went for £2.080,000.
Volumes are at historically low levels even below those seen at the time of the first lockdown and many estate agents are worried that if, as widely expected, the government raises the stamp duty rate at the end of March there will be even fewer transactions.
One local agent said, “It’s really discouraging to see the small number of transactions. There should have been at least a temporary boost due to the stamp duty holiday but this doesn’t seem to have come into play. Fingers crossed for a late rush of sales in the first quarter of this year but my impression is that people were already hurrying things up to meet the deadline by the end of 2020 just in case unexpected delays occurred.
“There has to be some concern about the softness in the secondary market for developers. A flat in Fitzroy House in Dickens Yard recently sold for 10% less than it was bought for five years ago. It will be hard to absorb all the planned supply if there is no expectation of capital gain and at the same time rents are softening which is driving down yields.”
Source: Land Registry
Source: Land Registry
Robert Gardner, chief economist at Nationwide, said, “To a large extent, the slowdown probably reflects a tapering of demand ahead of the end of the stamp duty holiday, which prompted many people considering a house move to bring forward their purchase. While the stamp duty holiday is not due to expire until the end of March, activity would be expected to weaken well before that, given that the purchase process typically takes several months (note that our house price index is based on data at the mortgage approval stage)."
February 11, 2021