Wandsworth is one of the most desirable London boroughs to live in, with attractions for all types of households. With its conservation areas, good transport links, excellent schools and other facilities as well as ongoing regeneration, demand to live in the borough is strong.
However more broadly, the UK housing market is in a stagnant state. Property transactions have been broadly flat since 2010 as uncertainty and transactions costs are affecting buyers’ willingness to move. In addition, sellers are only adjusting their expectations of achievable prices slowly. As a result, the lack of stock available to buy is causing delays in the time it takes deals to complete and extends the whole transactions process. This is the same for Wandsworth. The financial crisis had a big part to play, but policy changes in the form of changes to stamp duty have had an impact on the cycle too.
Effect of 2014 Change to Stamp Duty Bill in Wandsworth
Source: ONS, HMRC
The change to the new system of Stamp Duty in the 2014 budget had a significant difference on the transactions cost of moving for property over about £1 million. At today’s prices the difference in Stamp Duty under the old and new regime for the average priced detached home in the borough was 25%.
The effect of the change in Stamp duty on confidence in the more expensive parts of the capital, such as Wandsworth, was severe. As activity slowed, so too did house price growth as those needing to sell or concerned about a market correction were willing to accept lower prices. But also, the mix of property sales affected average price growth as the more expensive homes were also less likely to sell given the higher transactions cost.
While this change took place more than four years ago, it would be naïve to dismiss the impact that it still has on activity and on prices. Owners have to consider what else they would be willing to spend the money that would otherwise be spent on tax.
If you are interested in finding out more about the Wandsworth property market please contact SellMyHome.co.uk