The One London Suburb Booming as WFH Crowd Seeks Leafier Climes (2024)

The riverside district of Chiswick was the only area of London where house prices rose by more than a quarter in the year through September.

The affluent west London suburb defied the wider slowdown in house price growth in the capital, according to a Bloomberg News analysis of the latest UK Land Registry data. A backlog of central London residents searching for more space in the work-from-home era may have contributed to the 27% increase in prices in the W4 postcode during the period.

The figures, which are smoothed to remove outlier transactions, show the median price paid for a home in W4 was more than £1.05 million ($1.3 million) in September compared with about £832,500 one year prior.

“Chiswick house prices outpaced other districts because of a sweeping increase in demand,” said Jean Jameson, chief sales officer at Foxtons Group Plc. “Most sales in Chiswick last year were for terraced properties, as well as expansive detached homes.”

The boom in W4 comes at a pivotal time for the capital’s property market. House prices in some of the wealthiest central London districts dived during the pandemic as buyers sought out greener areas with more space. Meanwhile, the rest of the UK enjoyed a house price boom driven by a temporary relief on stamp duty.

The average house price in prime London, which includes central districts such as Knightsbridge and Mayfair, has since risen above £1 million again after falling to £973,000 in May 2020. This recovery gives prospective Chiswick buyers more purchasing power when they eventually secure a sale on their prime London home.

“We saw a huge influx of registrations and new buyers during the pandemic but there was nothing initially on the market,” said Charlie Peace, sales manager at broker Chestertons’s Chiswick branch. “That suited central London buyers, who were waiting for the market to pick up before they moved.”

The Land Registry data are yet to reflect the disruptive spike in borrowing costs that priced out many buyers in late September, or the latest effects of the decline in house prices. UK property values fell for a fourth consecutive month in December, adding to concerns that a deeper nationwide slump may be underway.

Over 800,000 UK households will see their mortgage rates more than double this year as they come off fixed-rate deals, according to Office for National Statistics analysis of Bank of England data. These soaring borrowing costs are the main driver behind Britain’s gloomy house price forecasts, with economists predicting a 10% drop in values this year.

Still, existing homeowners in Chiswick should be cushioned from the full impact of a slowdown due to a surge in values since 2020. BOE Deputy Governor Jon Cunliffe said last month that UK house prices could fall by as much as 20% without causing distress to homeowners, due to the price boom that occurred during the pandemic.

What’s more, one broker noted an increase in buyers moving back to Chiswick after escaping to the outskirts of London during the pandemic, further fueling demand. That’s because the district has “excellent transport links to central London” while offering a “taste of the country,” according to Euan Rollo, head of sales at broker Savills Plc’s Chiswick branch.

“At least half a dozen deals have gone through recently where people have moved back to Chiswick, which has driven competition in the area,” Rollo said. “The big, detached houses at the top end of the market have been most in demand.”

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