Boy has 2016 been a real whirlwind of a year! But now that the year is drawing to a close, it is time for us to look forward to what 2017 may bring to the UK property market. We’ve collated some of the comments and forecasts from UK’s top property experts on how 2017 might turn out. Of course, if it’s anything like 2016 has been; then be prepared to expect the unexpected.
Savills
Nationally, the markets continue to appear robust in all sectors, although there remains some hesitation on what Brexit will mean in the financial markets, around Biomed and also in an Agricultural market place without EU subsidies. The sterling devaluation has made UK property very attractive for international investors pegged to the US dollar or euro, with activity in central London likely to be dominated by Asian investors, with American and pan-European investors also strong nationally.
CRBE
• Demand for UK property nevertheless remains strong.
• Investors will aim to de-risk, seeking out secure Long Income and prime assets.
• Debt availability will remain good, except for development finance where additional scrutiny is very likely.
• Non-traditional sectors with different drivers will do well.
Rightmove
Although the market has built up some momentum which we expect to continue into next year, the uncertainty plus increasingly stretched affordability will continue to weigh on house prices, so our forecast for 2017 is for modest price growth of 2% nationally. We forecast Inner London to remain weak and prices to fall by a further 5% in 2017, as its price bubble continues to deflate, whilst Outer London is predicted to record a similar increase to this year of circa 3%.
Miles Shipside, Rightmove director and housing market analyst predicts: “The price of property coming to market in 2016 is currently up by 3.4% compared to a year ago, so while a forecast rise of 2% in 2017 is a lessening of the pace, it would still be the seventh consecutive year of rising property prices. As well as prices moving out of reach for some buyers, the sword of Brexit uncertainty hangs over the market, an unknown factor that may – or may not – have damaging consequences for the economy and confidence. There was a bout of jitters with the unexpected referendum result, albeit now seemingly short-lived, but more may arrive after Article 50 is invoked. For the time being any nervousness is being over-ridden by high demand for the short supply of suitable homes for sale in the lower and middle market in many parts of the country.”
Knight Frank
Looking into next year we believe that the slowdown in prices which has been evident in central London over the past 12-months will spread to the wider region, with Greater London prices down marginally in 2017.
This slowdown in the capital will likely be experienced across the rest of the country with price growth down notably on 2016 levels. The main drivers for weaker market performance relate to economic uncertainty surrounding the Brexit process, which we believe will impact negatively on consumer confidence in the run up to and just after the serving of the formal “notice to quit” the EU. In addition the impact of reforms to the taxation of landlords will reduce demand from investors which will limit upwards pressure on prices.
Looking at the prime London market, we believe that a 7% fall in prices across the western part of central London in 2016 means that we are close to the bottom in terms of price adjustment in this market. Although there could be some further adjustment downwards in prime outer London markets through 2017.
