Acton's Help To Buy Dependency 'Unhealthy'
But developer argues area is on cusp of huge regeneration
Developer says Acton Square project selling well
The latest sales figures show that the Acton property market is continuing to struggle with less than a sale a day reported so far this year.
The average price in the W3 postcode area in the first quarter of the year according to the Land Registry was £586,220 down by 9% on same period in 2018.
Demand for family houses continues to hold up relatively well and there have been twelve sales for a million pounds or more in the area. The highest price paid was £1,769,260 for a house on The Drive right next to Acton Mainline Station which will be served by Crossrail when it finally opens.
The market for flats remains quite subdued with just a handful of new build flats being reported as sold so far this year. Four were registered in the Granta Court development near the A40 and two each in Leighfield Court and Triumph House on Gunnersbury Lane. The previous quarter saw 32 sales of new builds although there may be more sales to be reported for the period under review.
The company behind Acton Square, the new gated development just off the Vale of one and two bed flats say the project has all but sold out. Built by Bellway London the scheme has just four properties left for sale.
Greg Allsop, Head of Sales for Bellway London, said, “It’s little surprise that the homes at Acton Square have been so popular due to the excellent location of the development, just 700 yards from Acton Park and a few miles from hotspots such as White City and Shepherd’s Bush.
“We are proud to have delivered 95 new homes to the area, which is on the cusp of huge regeneration, meaning now is an excellent time to buy in this part of west London.”
Acton Square comprises a mix of homes which Bellway say are built to a high specification, while externally the development benefits from landscaped courtyards. A range of one and two-bedroom apartments are still available at the development, prices start at £439,995.
House close to Acton Mainline station went for £1,769,260
It remains unclear as to how sales are proceeding in other major developments in the area such as Acton Gardens. Building work continues in the area so it does not appear that the developer is subject to any sort of cash squeeze.
One local property practitioner who asked not to be named said, "Help To Buy is significantly distorting the market at the moment. It is artificially inflating the price of flats up to the limit of £450,000 but making any unit in the range above that practically unsellable. Only 3 out of the 60 or so flats sold so far this year were for prices between £450,000 and £500,000.
"Without Help To Buy things would be even more dire than the are currently but this does mean that the local property market is developing an unhealthy dependency on the scheme. If it is withdrawn demand for flats the eligible price bracket might struggle to sell and the first-time buyers who used the scheme may have issues with negative equity."
The Nationwide’s House Price Index showed that London had the fastest pace of decline in the UK in the first quarter of 2019 with prices down by 3.8% compared with the same period in 2018 averaging £455,594. This is the steepest fall for the area since 2009 and the seventh consecutive quarter in which prices have declined. The Nationwide’s analysts say this partly reflects the level of price outperformance previously seen in the capital and the impact of policy changes on the Buy to Let market which has had a bigger effect on London because the private rental sector accounts for a larger proportion of the housing stock than elsewhere in the country.
Commenting on the figures, Robert Gardner, Nationwide's Chief Economist, said, “UK house price growth remained subdued in March, with prices just 0.7% higher than the same month last year.
“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, even though survey data suggests that sentiment has softened.
“Measures of consumer confidence weakened around the turn of the year and surveyors report that new buyer enquiries have continued to decline, falling to their lowest level since 2008 in February.”
The March 2019 RICS UK Residential Survey results show little departure from the subdued picture evident across the sales market for several months now. They say forward looking indicators suggest this lack of momentum is likely to continue for a while longer, although perceptions on the twelve month outlook are a little more sanguine. However London and the South East continue to display the weakest sentiment in terms of prices.
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| Acton Property Prices (January - March 2019) | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Area | Detached | Sales | Semi-det | Sales | Terraced | Sales | Flat/ mais |
Sales | Overall Ave |
Total Sales |
| W3 0 | 0 | 0 | 725000 | 2 | 613333 | 3 | 579000 | 1 | 644833 | 6 |
| W3 6 | 0 | 0 | 1083317 | 3 | 1177500 | 2 | 449409 | 11 | 659278 | 16 |
| W3 7 | 0 | 0 | 987500 | 4 | 755000 | 4 | 369852 | 22 | 503558 | 30 |
| W3 8 | 0 | 0 | 702500 | 2 | 675000 | 2 | 510944 | 18 | 543273 | 22 |
| W3 9 | 1450000 | 2 | 1210000 | 3 | 0 | 0 | 303750 | 6 | 759318 | 11 |
| Total | 1450000 | 2 | 977496 | 14 | 778636 | 11 | 425496 | 58 | 586220 | 85 |
| Change in Quarter | - | - | -7.4% | 0.0% | -1.2% | -26.7% | -4.7% | -26.6% | -0.9% | -22.0% |
| Change in year | - | - | -10.2% | 27.3% | -6.2% | -31.3% | -6.5% | -12.1% | -9.0% | -13.3% |
| Change in three years | - | - | 18.0% | -48.1% | -13.6% | -68.6% | -0.9% | -52.5% | -1.0% | -54.5% |
| Change in five years | - | - | 34.5% | -33.3% | 13.5% | -68.6% | 29.9% | -31.0% | 15.2% | -41.8% |
| Change in ten years | - | - | 165.9% | 133.3% | 60.4% | 37.5% | 61.4% | 190.0% | 75.4% | 150.0% |
May 10, 2019