Following several months of sluggish
activity in the Hampstead property market in the run up to the Easter, putting
the average price of a property in Hampstead today at £1,326,
574. Looking back over the past 12
months the average price was £1,366, 715. The Stamp Duty rises meant there was
a flurry of activity before April 1st, 2016 in avoidance of the
considerable hike for purchases of £1m or more and many others were put off
over the looming EU Referendum.
Interestingly, the Council of
Mortgage Lenders and Estate Agent trade bodies over the last few months have reported
seeing a fall in mortgage lending and enquiries from prospective homebuyers. This
is important because it comes amid an overall fall in housing market activity
in Hampstead. Data from the Land Registry said completed house sales in Hampstead
in the three months to January 2017, (the most up-to-date figures available)
fell by 36.98% compared to the same three month period up to January 2016.( Source- Land Registry )
However, I believe that the
slowdown in property sales in Hampstead is only supporting Hampstead property
values to a certain degree, despite the shortage of houses coming onto the
market; less of the housing stock is actually being sold. Even though in the
whole of the first Quarter of 2017, Hampstead property values seem subdued when
compared to the same period in 2016. Let
us remember, property values have been rising well above the level of inflation
over the past few years and for many this is a long awaited correction in the
market. On looking in to the figures more carefully, the average price in
Hampstead is 132.7% above the London average of £570,000. ( Source- Land Registry )
As I have said many times before,
the population in Hampstead is growing at a much higher rate than the number of
properties being built. This increasing demand for a roof over people’s head,
which is outpacing the supply of new houses being built in Hampstead, is creating
a severe imbalance in the Hampstead (in fact the whole of UK’s) housing market,
thus making homeownership an ever increasingly distant dream for many of Hampstead’s
potential first time buyers.
In fact, I still maintain the
view that house prices will bounce back in the next 12 months, even after
taking into account the wobbles caused by the Stamp Duty hike and Brexit
Uncertainty. The significant events of 2016 have thrown a lot at the London
property market with the ripple effect filtering in to the local market. With
the much talked about Article 50 being triggered for the UK’s departure from
the European Union and the ambiguity of the economic outlook in the short to
mid- term as knock-on effect, activity in the Hampstead property market is
likely to remain subdued, certainly over the next 3-6 months. The area has been
popular with foreign buyers for a number of years now, though many of them have
been sitting on the fence to see if the Pound falls any further.
Many Buy to Let landlords know
that investing in the Hampstead property market is a long-term strategy of 10,
20 even 30 years. Governments come and go, but unless Camden London Borough Council
start to build hundreds of new properties a year to make up for the shocking lack
of supply, Hampstead people will always want a roof over their head, and
irrespective of which party is in power, if there aren’t any council houses and
they can’t (or are unable to buy), a demand for rental properties will always
remain.
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If you are looking for an agent with experience that can help you find the right tenant for your property, then contact me to find out how we can get the best out of your investment property. Email me on chris@ashmoreresidential.com or give me a call on 020 7435 0420. Pop in for a chat – we are based at Ashmore Residential, Suite 7, 25-27 Heath Street, London, NW3 6TR. There is plenty of parking and the kettle is always on.
If you are looking for an agent with experience that can help you find the right tenant for your property, then contact me to find out how we can get the best out of your investment property. Email me on chris@ashmoreresidential.com or give me a call on 020 7435 0420. Pop in for a chat – we are based at Ashmore Residential, Suite 7, 25-27 Heath Street, London, NW3 6TR. There is plenty of parking and the kettle is always on.
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