|Flat Glut Nightmare for Developers|
Sales fail to recover as buyers switch to houses
Concerns of a major overhang of unsold flats in the Brentford area have increased with the publication of the latest information from the Land Registry.
These show that in the most recent three month period only 17 flats were sold in the TW8 post code area, the lowest number recorded since records began.
With most of the main developers having hundreds of unsold units it would take years to sell the backlog at this rate and with thousands of units in the planning stage the glut looks set to overhang the market for years.
For the first time since this information was published, the number of houses sold in the Brentford area matched the number of flats.
One local property expert commented, "The demand for houses remains strong because their supply is limited. Much of demand for flats has been from buy-to-let investors and they can no longer get financing so even those units that have been sold are often unoccupied. Nobody wants to move into a ghost development when they can buy a house with a garden for the same price."
Many of the people who bought Brentford properties as an investment are now trying to off-load them in the secondary market but they are finding buyers hard to find. The average price of a flat is 20% below what it was a year ago.
Reportedly developers are offering units for short-term rent and withdrawing them from sale so that they can market developments as having limited availability.
The average sale price of a property in Brentford during the second three months of this year was £255,977 down by 18.9% on the same period in 2008. However, given the low number of transactions, how representative this figure is can be questioned.
The figures for England and Wales as a whole show a modest improvement in the monthly change in house prices. The June increase of 0.1 per cent is the first time the monthly change has been positive since January 2008. The annual drop of 14 per cent took the average house price to £153,046.
London experienced the greatest monthly rise with a movement of 2 per cent, making it the region with the greatest monthly change and an average property value of £301,859.
All regions in England and Wales experienced a decrease in their average property values over the last 12 months.
The numbers below are subject to revision as is it usual that some properties are added late to the Land Registry's database.
Brentford Property Prices, April - June 2009
Where do I live? Brentford TW8 postcodes are divided into three sectors, TW8 0xx, TW8 8xx and TW8 9xx. Broadly speaking, TW8 0xx covers areas east of Boston Manor Road, TW8 8xx goes west of Boston Manor Road, whilst TW8 9xx covers the areas to the north of the A4.
Source: Land Registry
August 18, 2009