Leaves on the Line?
Delays on the sales train in Crossrail country
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Markets along the new Crossrail route attracted significant buyer interest when the scheme was first announced as prospective homeowners and investors recognised the difference that the new transport links would offer residents.
Between 2012 and 2015 the number of sales around the proposed stations grew twice as quickly as the London average. While the promise of Crossrail has boosted both the values and number of home sales along the new route since it was announced, activity is now slowing down as we get closer to the line coming into service.
This changed in late 2015 when activity slowed sharply as owners along the route have either chosen to stay put or wait for Crossrail to open. The number of existing homes sold in the kilometre around Crossrail Stations has fallen by a third over the last year and there are few signs of more homes coming onto the market any time soon.
The number of homes sold around Crossrail stations in zones three and four in both East and West London have fallen the fastest. In Maidenhead, Stratford and Ilford, sales close to the new rail link between November 2015 and January 2016 plummeted by over 40 per cent compared with a year earlier.
But house price growth along the route are outperforming London as a whole, with a growth rate on average three per cent higher than the average for the capital. Price growth in zones four to six are the most buoyant.
For example the average price growth in London’s zone five was 15.4 per cent, yet around the Crossrail stations in this zone, the average price rise was almost 20 per cent. While the beneficial effect of Crossrail should now be fully priced in, the apparent reluctance to sell, reflected in a lack of available stock, could push up prices as we get closer to the line opening.
In places where Crossrail will cut journey times significantly, buyers who have moved in are making do with existing connections until Crossrail opens but may also benefit from higher prices as a result of the lack of available stock now.
Existing residents who have chosen to stay put throughout the disruption may be choosing to wait for the line to open before selling up to increase the chances of a better price to allow them to move on. Similarly, investors who have chosen not to live in a property might do the same to maximise their capital growth.
If sellers are holding off until Crossrail is up and running, a rise in the number of homes for sale straight after it opens could mean more choice and be a better time to buy for those still looking to take advantage of new links. And it seems likely that there will be less demand from investors.
Already the mix of buyers along the route has shifted away from investors, towards owner occupiers and the stamp duty surcharge is only likely to ensure this trend continues.
It could be time for homebuyers to sweep up!
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