|Don't Panic! Chiswick Property Prices Not in Freefall|
Pocket Living sales drive down average in W4 but agents optimistic for 2020
According to the latest figures from the Land Registry Chiswick property prices fell by 18.2% in 2019 but local estate agents are saying there is no cause for alarm.
Christian Harper of Harper Finn said that the numbers might be used as ammunition for speculative potential purchasers but they would not be able to steal a bargain from any seller to whom he had had the chance to talk.
The main reason for the sharp fall in the average price at the end of the year was the inclusion of sales from the Pocket Living development. There have been 135 sales reported so far for the fourth quarter of 2019 in the W4 postcode area, 38 of which were in the tower block on Bollo Lane. This drove the overall average down to £780,898 from the level of around a million which it had hovered close to for the past few years.
These small units were mainly priced between £300,000 and £400,000, substantially below the normal average for the area. Excluding these sales property prices would have been down in Chiswick over the year but by low single digits.
The company which developed the Pocket Living tower on the site formerly occupied by G&R Removals is 50% owned by the owner of the Miami Dolphins American football team. There are 105 flats in the development, 90 of which are classed as affordable because they are reserved for people already living in the London Borough of Ealing earning less than £90,000 per annum.
Despite the moribund market and political and economic uncertainty that reigned at the end of last year, buyers were still prepared to pay high prices for large family homes in Chiswick. There were several multi-million pound sales the highest priced of which was for a detached house on The Orchard which went for £3.1million.
Local agents are detecting a pick up in activity since the New Year with the uncertainty of the election out of the way and a decision on the future nature of our relationship with the EU coming closer.
Paul Cooney, Director of Horton and Garton said, “What is apparent from not just the figures but my decade of experience in the local market is that the quantity of houses coming to market has been extremely stagnant.
"As sellers and buyers held their breath in the lead up to Brexit and the general election, this negatively impacted the value and saleability of properties. We knew a Conservative majority would lead to a bounce for the local market but we are in uncharted waters; no agent could have predicted the instantaneous uptick in both quantity and quality of buyers returning to the market but also the confidence with which they are offering and purchasing. This has led to a remarkable upturn in value across both houses and flats and in one recent transaction this resulted in a 10%+ increase in the price achieved in just a handful of months."
James Waight, Associate Director at John D Wood on Turnham Green Terrace added, "Although the latest quarterly numbers continue to paint a morbid picture of the Chiswick property market, I am certain that the next set of figures will provide evidence of a recovery. The looming General Election in December last year undoubtedly played a role in many buyers and sellers choosing to delay their moves until the result came in. Since the election we have seen an increase in confidence amongst buyers and a significant increase in the number of buyers registering. However, the dynamics of the market haven’t shifted significantly, there is still a huge shortage of available properties which is creating lots of competitive bidding amongst buyers."
Christian Harper is also seeing a revival but he is a tad more cautious and says that the industry is giving out a number of conflicting signals which are confusing both buyers and sellers. To illustrate his point he relates, "A couple of weeks ago I was at a birthday party and was discussing the property market with a couple of mates who also live in Chiswick. Within five minutes I was told that the market is booming by one who had received a number of letters through his door from smiling estate agents. Then another friend quoted the fascinating article on 24 January by the FT. I had already read the article and felt that it was balanced, honest and reasonably accurate. As a Chiswick seller it was paraphrased to me as 'The FT state that Chiswick is unique in London and prices haven't fallen'.
"Is this the same Chiswick that I live and work in? Whilst we all love a positive story, the fact remains that houses have been very tricky to sell in the past months. Thankfully, green shoots (estate agents love this phrase) are certainly evident. The phones are starting the ring and viewings are starting to be booked again so this spring (might) be a good one. "
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
Chiswick property prices are very likely to bounce back in the first quarter of this year if only because most of the sales in the Pocket Living development went through in 2019. However, most agents are looking forward to a more active market rather than one that delivers significant price rises. The industry has had to subsist on meagre commissions for several years and it is thought some of the more marginal local agents will not survive without a sharp rise in turnover.
Paul Cooney thinks that there is reason for optimism particularly at the top end of the market. He says, "The spring market has brought a renewed enthusiasm we knew was in the offing, but we simply couldn’t have predicted the immediate impact on prices achieved. Quality Chiswick homes, especially family houses, are commanding immediate attention from serious buyers who have been waiting in the wings for months and, in some cases, years.”
Christian Harper, shares that view with caveats, he says, "If only I had a crystal ball! If I did, I would be happy to share my findings with you all. In the real world what I can offer is a combination of my 30 years of Chiswick knowledge and experience combined with my thirst to research opinion from variety of sources so that I can attempt to see through the fog of noise and provide a balanced and honest view to my clients.
"Now that Boris has actioned the formal exit of the Brexit process and the tape recording of Big Ben rang out on 31st January, uncertainty has begun to be replaced with clarity. Industry is feeling more settled and thus employees are becoming more confident to extend borrowing. It's fast becoming a market fuelled by want rather than just need. I suspect that the market will take a few steps forward in terms of price and then may step back slightly before the inevitable cork popping if all goes well with Brexit negotiations.
"I have no plans to move however if I was looking to transact over the next twelve months, I would certainly be looking to sell now and to trade up while I still could."
Commenting on the figures, Robert Gardner, Nationwide's Chief Economist, said, “January saw a further modest pick-up in annual UK house price growth to 1.9%, from 1.4% in December. This follows twelve 12 successive months in which annual price growth had been below 1%.
“Indicators of UK economic activity were fairly volatile for much of 2019, but the underlying pace of growth slowed through the year as a result of weaker global growth and an intensification of Brexit uncertainty.
“Recent data continue to paint a mixed picture. Economic growth appeared to grind to a halt as 2019 drew to a close, though business surveys point to a pickup at the start of the New Year. “
The Royal Institution of Chartered Surveyors’ (RICS) November 2019 UK Residential Market Survey reported that key measures of buyer demand point to sales remaining in negative territory, the uncertainty surrounding the 2019 General Election and Brexit being the likely cause of suppressed activity. However, there is an expectation that a more stable trend is likely to emerge over the coming three months.
The Bank of England’s Agents’ summary of business conditions – 2019 Q4 reported that the housing market remained subdued, mainly due to the October Brexit deadline and the General Election. Contacts reported that house prices were modestly down on a year ago in the south and modestly up elsewhere.
Robert Gardner added, “Looking ahead, economic developments will remain the key driver of housing market trends and house prices. Much will continue to depend on how quickly uncertainty about the UK’s future trading relationships lifts, as well as the outlook for global growth. Overall, we expect the economy to continue to expand at a modest pace in 2020, with house prices remaining broadly flat over the next 12 months.
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