|Town Centre Development Heats up Hammersmith Property Market|
Sales soar at Sovereign Court but overall outlook remains uncertain
View from a terrace at Sovereign Court in Hammersmith town centre
Hammersmith's town centre has become a hotspot for property investors, who have been flocking to buy upmarket flats at Sovereign Court in Glenthorne Road, behind Kings Mall.
Land Registry figures show that 33 flats at the St George development were sold during the final quarter of 2018. Most had price tags of between £900,000 and £1.5 million, but one, a penthouse in Montpellier House, changed hands for £5,518,450.
That was the fifth highest price ever achieved for a flat in Hammersmith, behind three apartments in another St George development, Fulham Reach, which fetched £8,140,00, £7,287,954 and £7 million, and one in neighbouring riverside development Queen's Wharf which was sold for £6,100,000.
In the traditional market, there were also a handful of high-priced sales, with a four bedroom semi-detached house in Hammersmith Grove changing hands for £4,500,000 and two in Stamford Brook achieving £2,950,000 and £2,500,000.
The wider picture however was somewhat cooler between October and December, with average prices of both terraced houses and traditional flats falling back by 14.7% and 10.9% respectively after a small bounce in the previous quarter.
The average price of terraced houses during the period was £1,189,169, which was also a drop of 7% from the same period in the previous year while the average flat price was £833,891 - a fall of 13.8% over the year.
This meant the overall average price also fell, though by a much smaller 1.5%, over the year to £1,014,905.
This of course is good news for first timers and those with smaller budgets looking for affordable properties. The figures show 16 flats selling for £400,000 and some slipping below £300,000 - including a studio in Lena Gardens in Brook Green, pictured below, which fetched £283,000.
Teresa Brewer of local estate agency Finlay Brewer says: " For buyers – given the paralysis which is the direct result of the lack of clarity on the Brexit negotiations, there are certainly good buying opportunities out there at the moment.
Here at Finlay Brewer we are still selling and renting properties. Sellers are beginning to understand the market and we are seeing far more sensible asking prices. From the buyers’ perspective, many of them are utterly fed up with the never-ending Brexit negotiations and are simply ‘moving on’ with their lives."
"The simple fact remains that everyone needs somewhere to live, there is still a shortage if good quality housing and the fundamental reasons for people having to move have and will not change."
UK house prices grew by 2.5% in the year to December 2018. This is the lowest annual growth for the UK since July 2013. London property prices fell marginally over the year with only the North East also seeing a decline.
Tom Bill, Partner and Head of London Residential Research at Knight Frank said, "The influence of political uncertainty on the prime London property market has grown markedly in the last six months. In the first half of 2018 there were signs the market was beginning to rally as asking prices adjusted more fully to reflect higher transaction costs.
"However, with Brexit uncertainty persisting ahead of the UK’s planned departure from the EU, sales volumes in prime outer London were down by 10% year-on-year in January and the annual price decrease widened to 4.6%.
"Identifying individual factors affecting the performance of the prime London property market can be a complex task but the impact of political uncertainty was decisive during 2018. Indeed, economic sentiment indicators displayed a similar trend. The Lloyds business barometer began the year with a reading of 35% in January but had fallen to 17% by December.
"However, there are signs that pent-up demand is building. The number of new prospective buyers registering rose by 5% across prime London markets in 2018. Indeed, the ratio of new demand to new supply rose to 4.9 in the final quarter of 2018, the highest level in four years.
Robert Gardner, Nationwide's Chief Economist, said:" Indicators of housing market activity, such as the number of property transactions and the number of mortgages approved for house purchase, have remained broadly stable in recent months, but forward-looking indicators had suggested some softening was likely.
"In particular, measures of consumer confidence weakened in December and surveyors reported a further fall in new buyer enquiries towards the end of 2018. While the number of properties coming onto the market also slowed, this doesn’t appear to have been enough to prevent a modest shift in the balance of demand and supply in favour of buyers in recent months."
The Bank of England’s Agents’ summary of business conditions for 2018 Q4 reported that along with low supply of houses, demand was also falling. Housing activity in southern England was muted due to uncertainty, with transactions postponed until after the EU withdrawal. The demand for new build houses remained stronger outside London, in part due to housebuilders offering more incentive to finalise sales.
The Royal Institution of Chartered Surveyors’ (RICS) UK Residential Market Survey for December 2018 reported that new buyer enquiries fell for the fifth month in a row. This fall in demand was accompanied by a lack of fresh stock coming into the market as the survey’s indicator on new instructions remained in negative territory for the sixth report in a row.
The UK Property Transactions Statistics for December 2018 showed that on a seasonally adjusted basis, the number of transactions on residential properties with a value of £40,000 or greater was 102,330. This is 3.6% higher than a year ago. Between November 2018 and December 2018, transactions fell by 0.1%.
The Bank of England’s Money and Credit latest release showed that mortgage approvals for house purchases (an indicator of future lending) were around 63,800 in December, unchanged from November, but slightly below their 2018 average of around 65,200.
Source: Land Registry
March 15, 2019