Commentators have claimed that the housing market is in fine fettle, with a shortage of supply continuing to push property prices upwards. According to Halifax, prices in December were 6.5 per cent higher than a year earlier — compared with a 6 per cent rise in November — and they jumped 1.7 per cent month on month, taking the nationwide average cost of a home to a high of £222,484. The Halifax figures appear upbeat, so what are the predictions for 2017?
It may be a new year and a fresh start, but 2016 will have a strong effect on the housing market. Stamp duty, Article 50 and Trump are all factors that create discontent and uncertainty. But there are positives that make for healthy housing market predictions. Low interest rates, high employment and the shortage of homes for sale has led to most commentators to predict prise rises.
The government are keen to talk about let’s build more housing, which has been greeted with a muted response. The long-awaited, much debated housing white paper is due to be published this month. This is expected to contain incentives to encourage the building of more starter homes for first-time buyers, houses on brownfield sites, modular properties and a greater emphasis on flexible tenures. This is in addition to the development promised in the garden villages, towns and cities announced last week.The heartfelt ambitions of Sajid Javid, the secretary of state for communities and local government, and Gavin Barwell, the housing minister, may still be thwarted by Nimbyism, opposition to building on green belt land, and a lack of brickies. We need more housing in this country and we all wait to see how this government can achieve it.
Higher stamp duty is the main reason we hear against relocation at the upper end of the market. Despite lower transactions at the upper end of the market in the second half of 2016 the government may still receive a record sum from this tax in the 2016-17 tax year. If, in the spring, revenues appear to be down, the chancellor may order a reprieve in the budget on March 8, although stamp duty cuts could be seen as a handout to the metropolitan elite. We will wait and see what happens.
Buyers are demanding perfection or potential for improvement. This may come as no surprise but this sentiment seems to be accentuated in the current market. Our buyers want to move into the picture perfect home that they would be proud to share on Instagram or they want an untouched gem to transform. The exodus from London for first time buyers and families looking for a larger home will continue.
The housing market is tough to predict, but I put a wager on beautiful properties, in great locations will sell quickly and for good prices. That’s what Mr & Mrs Clarke have always dealt in and will continue to do so whether Trump is in charge of the World, whatever the stamp duty rate is and whichever colour is in fashion.