Concerns expressed that pandemic has permanently changed local needs
Covid-19 may have reduced potential demand for Perceval House development. Picture: Vistry
The most recent sales figures for the Ealing area have raised concerns about the future direction of the property market.
So far this year more houses than flats have changed hands in the W5 postcode area despite the latter making up a much larger proportion of housing stock. This is a confirmation of a trend that began when the coronavirus struck over a year ago.
Now, some local property market professionals are saying that a fundamental shift has taken place in housing demand which is not reflected in the predominantly high-rise, small unit supply coming to the market with more time likely to be spent working from home.
In 2021 to date only 11 flats have been reported as sold to the Land Registry in the W5 postcode area none of which were newly built and for the whole of 2020 only 17 new build units were registered as being sold. Local practitioners point out that not all transfers of residential property are recorded by the Land Registry but concede that turnover is exceptionally low by historic standards.
One Ealing based agent commented, “What exactly is happening in the local market at the moment is very difficult to pin down. The developers are keeping their cards close to their chest but I suspect it is hard work shifting a significant number of units right now.
“Demand will always be there for quality, well-located properties so schemes like the Filmworks development should ultimately be okay but even there I’ve heard that generous sweeteners are being offered to potential buyers.
“The problem going forward is likely to be too much supply of the wrong type of housing. The majority of flats being built are one bedroom and the amount coming to the market within a three mile radius will quickly absorb demand for this kind of unit.
“The building splurge was partly predicated on Crossrail and the significant reduction in commuting time but, with working patterns likely to change forever due to the pandemic, this isn’t as big a benefit than it used to be. Buyers are much more likely now want bigger units because they need to incorporate space for a home office but most units currently being built, including those in the Perceval House development, aren’t suitable. Buyers will increasingly prioritise higher square footage over proximity to good transport links.”
Similar concerns were raised by councillors on the Ealing borough planning committee objecting to the Council’s plans. Some changes were made to the design to increase the number of three bedroom flats in the development but these were not sufficient to convince many of the committee members that the building would serve local housing needs.
There have been just 24 sales reported to the Land Registry for the W5 postcode area in the first quarter of 2021 at an average price of £929,333. This would be an all-time high but it is likely to be revised down significantly as more sales are registered for the period.
Activity appears to be holding up relatively well for large family houses with a detached house in Park View Road selling for £2,550,000.
Despite the falling market activity for flats, there is no evidence yet that prices are falling significantly and a unit in the Dickens Yard development changed hands for £1,250,000 having being sold as new for £1,000,000 back in 2016.
There was a big fall in the average price in the W13 postcode area but this looks like a reversion to the mean after a sharp rise in price in West Ealing at the end of last year. Turnover in this part of Ealing remained relatively robust which agents say is indicative of the higher proportion of houses as opposed to flats in the postcode’s housing stock.
|Ealing W5 Post Code Area Property Prices - (January - March 2021)|
|Area||Detached||Sales||Semi-det||Sales||Terraced||Sales||Flat/mais||Sales||Overall average||Total sales|
|Change in Quarter||-||-||22.3%||-72.2%||-9.0%||-83.3%||18.2%||-78.4%||15.4%||-79.1%|
|Change in year||59.5%||-77.8%||39.7%||-58.3%||1.8%||-78.6%||5.4%||-82.5%||33.2%||-78.6%|
|Change in three years||72.3%||-71.4%||56.7%||-70.6%||-10.8%||-78.6%||-10.8%||-83.6%||24.8%||-79.8%|
|Change in five years||18.8%||-87.5%||28.0%||-75.0%||-5.0%||-88.0%||0.4%||-91.5%||23.4%||-88.9%|
|Change in ten years||-||-||107.0%||-37.5%||58.8%||-75.0%||65.5%||-85.9%||144.8%||-78.2%|
Source: Land Registry
|Ealing W13 Post Code Area Property Prices - (January - March 2021)|
|Area||Semi-det||Sales||Terraced||Sales||Flat/mais||Sales||Overall average||Total sales|
|Change in Quarter||-11.6%||-80.0%||-9.5%||-56.7%||5.2%||-53.8%||-21.8%||-66.7%|
|Change in Year||-17.0%||-66.7%||-1.2%||-60.6%||-5.8%||-81.3%||3.0%||-70.3%|
|Change in Three Years||-16.9%||-72.7%||1.9%||-45.8%||-2.3%||-82.4%||0.8%||-69.0%|
|Change in Five Years||-18.2%||-84.2%||1.3%||-63.9%||-11.6%||-90.9%||2.3%||-82.3%|
|Change in Ten Years||16.6%||-50.0%||58.4%||-55.2%||62.1%||-86.7%||82.8%||-72.5%|
Source: Land Registry
Nationally the property market seems to have experienced a bounce in April after the announcement of the stamp duty holiday extension reaching a new record high average price of £238,831.
Commenting on the figures, Robert Gardner, Nationwide's Chief Economist, said, “Annual house price growth accelerated to 7.1% in April, only slightly below the peak of 7.3% recorded in December and up from 5.7% in March. In month-on-month terms, house prices rose by 2.1% in April, after taking account of seasonal effects, the biggest month rise since February 2004.
“Just as expectations of the end of the stamp duty holiday led to a slowdown in house price growth in March, so the extension of the stamp duty holiday in the Budget prompted
a reacceleration in April.
“However, our research suggests that while the stamp duty holiday is impacting the timing of housing transactions, for most people it is not the key motivating factor prompting them to move in the first place. For example, amongst homeowners surveyed at the end of April
that were either moving home or considering a move, three quarters said this would have been the case even if the stamp duty holiday had not been extended."
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May 6, 2021