insight

insight
The West London property market
Spring/Summer 2016
Many of one.
Ealing & Acton
Shepherd’s Bush
& Acton
Chiswick
Hammersmith
& Brook Green
Kensal Rise
& Queen’s Park
North Kensington

winkworth.co.uk
NARENDRA GANDHI
Ealing & Acton
Michael Connaughton
Shepherd’s Bush & acton
Richard berenger
Chiswick
BEN HUNT
Hammersmith
& Brook Green
STEWART BOYD
Kensal Rise
& Queen’s Park
Andrew Whelan
North Kensington
Welcome to our Spring/Summer 2016 West London
Market Insight. With the seasons changing and some big
events on the horizon, we explore both the challenges
and opportunities for the West London property market.
One of the biggest questions that remains to be
answered is how much impact the 3% stamp duty
surcharge will have and we explore this in detail in our
topical section. One event, the Budget, has already
taken place and the housing market largely managed
to avoid any controversies. Indeed, the clarity from the
Chancellor's announcement has helped provide stability
and, despite the challenges being faced this year, we
believe the longer-term growth opportunities in West
London are encouraging to investors and occupiers alike.
1›

MArket
overview
In the first quarter of this year, our West London offices
registered nine new applicants looking to buy for every
new property instructed to sell. Demand was dominated
by buy-to-let investors and pied-à-terre buyers.
With buyers rushing through deals
before April, it was a busy first
quarter. Demand for properties
has been particularly strong in the
£500,000 to £750,000 price bracket
and, over the last year, sales at this
level have increased by 12%. Average
prices have remained stable,
increasing by 2% over the last
12 months.
There is little doubt, however, that 2016
will prove to be a challenging year
across London's housing market.
Along with increased buying costs and
legislation impacting investors, the
EU Referendum and Mayoral Election
have added a further layer of
uncertainty, forcing some buyers to
adopt a wait and see strategy. As such,
it is likely that average prices will remain
largely unchanged over the year.
12.2%
rise in transactions
between £500,000
and £750,000
Last 12 months compared to previous 12
Land Registry
Strong demand for West
London rental properties
In the lettings market, the start of
2016 has been busier than expected,
with strong demand for both flats
and family homes. Uncertainty in the
sales market has led some buyers to
rent in the short term, boosting
demand levels further. As a result,
there has been a 10% increase in
properties let across West London
over the first quarter. Void periods
have reduced and properties are
letting quickly - within a couple of
weeks of coming to the market. While
the average rental value of properties
let in quarter one was just 0.6%
higher than in Q1 2015, particularly
strong demand for one bedroom flats
has pushed up average values by
9.4% over the last year.
We anticipate that some investors
may dispose of their portfolios ahead
of the April 2017 legislative changes
with restrictions on mortgage interest
tax relief. As stock levels tighten and
landlords seek to recoup additional
costs, rental levels are expected to
rise further.
WEST LONDON
INDICATORS
9.4%
increase in average
rental values of one
bedroom flats
Q1 2016 vs Q1 2015
LonRes
Spring/summer 2016 ‹ 2

Stamp duty
Is stamp duty as taxing
as we are led to believe?
While investors and second home buyers will now incur
higher stamp duty bills, we argue that huge investment
and regeneration in West London is likely to support
above average house price growth in the long term,
which should counter the additional charges for investors.
The surcharge in stamp duty for
second property owners means that
investors across West London will
now face a stamp duty bill of just
under £49,000 (based on the average
sales price of £732,000 over the past
12 months). This is £22,000 more
than the bill for an owner-occupier.
The lowest stamp duty costs in our
area are in Ealing, where average
property prices equate to a stamp
duty surcharge of just over £18,000.
In Chiswick, investors will need to
pay, on average, £29,000 more than
occupiers. While considerable sums of
money, the average stamp duty costs
White City campus,
Imperial College London
in all parts of West London are
substantially lower than the £160,000
bill facing investors in prime central
London, where average sales prices
are some 125% higher.
We believe that the long-term capital
growth opportunities will outweigh
the extra stamp duty hike on
additional properties. Over the past
five years, average sales prices across
our area have increased by 49%, an
average compound rate of 8.4% per
annum. For investors to recoup the
additional stamp duty costs, average
values would need to rise by just
6.6%, less than one year’s growth
at historical rates.
Similar analysis at a local level reveals
that it would take less than 1.5 years
to recoup costs in all parts of the West
London housing market, ranging from
0.6 years in Kensal Rise and Queen’s
Park to 1.3 years in North Kensington.
West London’s regeneration
continues at pace
We still have investors continuing to
express interest in buy-to-let
3 ›

How long would it
take for an investor
to recoup stamp
duty costs?
Stamp Duty costs
main residence
investor / second home
Chiswick
Ealing & Acton
Hammersmith
& Brook Green
Kensal Rise &
Queen's Park
Shepherd's
Bush & Acton
North
Kensington
£39,143
£67,761
£20,413
£38,661
£33,252
£59,204
£33,287
£59,204
£23,458
£43,533
£33,380
£59,408
Kensal Rise
& Queen's Park
£865,742
average price
0.6
years
Chiswick
£953,934
average price
1.0
years
Ealing
& Acton
£608,262
average price
0.7
years
Shepherd's Bush
& Acton
£669,157
average price
1.0
years
Hammersmith
& Brook Green
£865,049
average price
0.8
years
North
Kensington
£867,597
average price
1.3
years
Source: Dataloft, based on average compound growth rates over past 5 years and full stamp duty costs
for an investor/second home buyer.
West London continues to benefit from
significant regeneration and house prices
are largely anticipated to outperform
rates of growth in other parts of London.
properties. Demand may be muted
for a time, but we are confident that
while residential property continues
to be seen as a valuable asset class,
there will be a bounce back in the
market. Even assuming that prices
remain stable over 2016, the
long-term growth prospects for the
West London market are encouraging
for investors and the market looks
well placed to quickly absorb the 3%
stamp duty surcharge.
The area continues to benefit from
significant regeneration, investment
and transport improvements and,
looking ahead, house prices are
largely anticipated to outperform
rates of growth in other parts of
London. The development around the
HS2 and Crossrail interchange at Old
Oak Common will transform 130
hectares of previous industrial land,
with around 25,000 new homes and
commercial development to support
65,000 new jobs. The latest
consultation period around the Local
Plan closed at the end of March 2016.
In addition, the creation of the White
City Campus by Imperial College is
set to provide a major boost to
regeneration in this area with
numerous homes, jobs, and
leisure and retail facilities.
Spring/summer 2016 ‹ 4

The local
view Sales
Transaction levels in West London have held up more
favourably than in prime central London. With an
average sales price of £700,000, buyers in this area have
not been penalised by tax reforms in the same way as
central London. In fact, 83% of properties sold in West
London since 2014 have incurred lower stamp duty bills
than under previous rules.
Transactions over last 12 months
compared to previous 12 month period
West London
Prime central London
local sales
at a glance
20%
0%
-20%
-40%
Under
£500k
£500–£750k
£750–£1m
£1m–£2m
£2m+
83%
of properties sold since
end 2014 have incurred
lower stamp duty bills
Source: Land Registry
than under previous rules
Average sales prices across West London in last 12 months
£953,034 £867,597 £865,742 £865,049 £669,157 £608,262
£1m
£800,000
£600,000
£400,000
£200,000
10%
fewer transactions over
last 12 months
compared to previous 12 month period
(21% fall in PCL)
Land Registry
£0
Chiswick
North
Kensington
Kensal Rise Hammersmith
& Queen's Park
Shepherd's
Bush
Ealing
& Acton
Source: Land Registry
5›

The local
view lettings
Despite regulatory and tax changes, we believe
landlords should be encouraged by the strong levels
of tenant activity in the West London lettings
market. Properties are letting quickly, with some
increases in rental values achieved.
Properties let across West London, Q1 2016
26%
Under £350 per week
£350–£500 per week
£500–£750 per week
£750–£1,000 per week
£1,000–£1,500 per week
£1,500+ per week
Source: Dataloft, using LonRes data
Average weekly rents continue to rise in West London
£580
£560
£540
£520
10% 5%3%
19%
37%
£557 £570 £577 £579
local lettings
at a glance
9
tenants searching
for every property
available to let
Winkworth West London offices,
March 2016
98.2%
average percentage
of asking rental
value achieved
Q1 2016
Lonres
£500
Q215 Q315 Q415 Q116
Source: Dataloft, using LonRes data
Spring/summer 2016 ‹ 6

Average house price
last 12 months
Average flat price
last 12 months
W7
W13
W5
W3
W4
W6
£597,957
£337,659
£843,733
£406,523
£961,468
£506,786
£911,615
£412,539
£1,414,217
£571,199
£1,455,329
£655,385
WE’VE GOT west
LONDON COVERED
Our offices work closely together to provide
a comprehensive service for our clients.
By tapping into the extensive Winkworth
network, we have access to thousands of
potential buyers and tenants across
London and beyond.
SW6
W14
W12
NW10
NW2
NW6
W10
£3,015,143
£845,319
£1,112,982
£503,860
£847,167
£397,171
£819,052
£485,421
£1,762,904
£619,877
£1,348,883
£599,023
Source: Land Registry.
Note: Average prices based on
March 2015 to February 2016
narendra
gandhi
Ealing & Acton
020 8896 5681
STEWART
BOYD
Kensal Rise
& Queen’s Park
020 8960 4947
Richard
Berenger
chiswick
020 8994 7096
Michael
Connaughton
SHEPHERD'S BUSH
& ACTON
020 8735 3266
ben
hunt
hammersmith
& Brook Green
020 7371 4466
Andrew
Whelan
North
Kensington
020 7792 5000
Disclaimer: This report is produced for general information only. While every effort has been made to ensure the accuracy of this
publication, Dataloft Ltd accepts no liability for any loss or damage of any nature arising from its use. At all times the content
remains the property of Dataloft Ltd under copyright, and reproduction of all or part of it in any form is prohibited without
written permission from Dataloft Ltd.
Date of publication: April 2016 Photo credits: page 1, 2, back cover: all Alamy; page 3 courtesy of Imperial College.