OnTheMarket gathers opinions from across the property industry.
Predicting trends in house prices is tough at the best of times but particularly so at this time of year. Currently, it is anybody’s guess where the Brexit negotiations are heading and what the ramifications might be for the economy and, ultimately house prices. Many overseas investors are likely to play a waiting game, certainly in the first half of the year. But it is certainly not all doom and gloom.
Different experts are making slightly different forecasts for the year ahead but this broad cross-prediction of forecasts will help build up a picture of what we can expect to see in 2018.
- Estate agent Jackson-Stops believes that prices will remain flat in 2018 with higher value homes continuing to feel the strain of stamp duty. “‘Prohibitive levels of stamp duty have been a real drag on the UK property market over the last year with sales levels falling by eight per cent,” said Nick Leeming, Chairman of Jackson-Stops.
- Price Waterhouse Coopers is rather more bullish, believing that average UK house prices will rise by four per cent a year until 2025.
- Strutt & Parker predicts that, in the UK as a whole, there will be house price growth of 2.5 per cent in 2018, but that in London, prices will remain flat.
- Strutt & Parker is also predicting great things in 2018 for the so-called ‘Oxford-Milton Keynes-Cambridge corridor’, for which Philip Hammond pledged support in his Budget. Paul Sutton from Strutt & Parker Cambridge said: “House prices in both Oxford and Cambridge have been driven by high demand and low supply. And because of the burgeoning hi-tech industries in the two cities, there will need to be a lot more housing in the bordering villages and commuter towns – which, in turn, will drive up prices.”
- The Halifax’s latest ‘house price optimism index’ – a very rough guide to what people are expecting to happen to house prices – fell by 14 per cent between April and October, with one in five of those surveyed expecting house prices to fall in the next twelve months.
- Savills is predicting that house prices in the UK will rise by one per cent in 2018. “Uncertainty over what Brexit means for the UK economy and how it will impact on household finances will increasingly act as a drag on house prices,” says Lucian Cook, Savills Director of Residential Research.
- Knight Frank is also predicting that house prices in the UK will grow by one per cent in the course of the year.
- At the other end of the scale, business consultancy Morgan Stanley is predicting a 1.6 per cent drop in values next year.
The majority of experts are expecting prices across the UK to rise but only by very modest amounts. There is also a consensus that, as was the case in 2017, the rate of house price growth in the UK, as a whole, will be greater than that in London. Only time will tell if experts are being unduly cautious, or house price growth will surprise us all.
