Happy New Year and welcome to 2018!
Here at Urbane Brix we've been taking a look at some of the property trends (the good and the bad) that will be hitting us this year.
Slow (but Steady) House Price Rises
Like 2017, property rises in the New Year will remain stable, with any rises fairly moderate.
Halifax note in their house price forecast for 2018 that growth will be weakest in London and the South East, but forecast an annual rise in property values of up to 3% by the end of 2018, which despite the current Brexit climate, is quite positive!
The report suggests that this slow growth in 2018 is due to the tightening of consumer spending as inflation outstrips wages.
Keep an eye on how the market performs throughout the year to see if this growth materialises.
Property Continues to Boom in the North
Expect more northern cities, such as Manchester and Liverpool, to be hitting the headlines in 2018.
This continues to be a trend, as for the last couple of years the North has received quite a lot of attention, with affordable property prices, strong rental demand and massive potential for capital growth.
The ‘Northern Powerhouse’ initiative has meant that all eyes are now firmly resting on the North’s leading cities. Over the next few years, the government plans to create an ‘economic powerhouse’, with Manchester becoming the beating heart of the operation. This will mean even more money coming into the regions as investment in transport, business and construction will secure the North’s reputation and take the shine off from London.
Reduction in the number of properties bought and sold
The Royal Institute of Chartered Surveyors (RICS) predict that the number of transactions will drop from 1.2 million in 2017 to 1.15 million in 2018. This is largely down to the economic and political uncertainty brought about by Brexit and also the lack of available property on the housing market.
Lack of housing remains the biggest challenge for the UK, so expect this topic to pop up throughout the year. In the recent autumn budget, the government announced its pledge to build 300,000 new homes a year. It will be interesting to watch how quickly this can come into effect and how it will impact the property market.
House market stalemate in London
After decades of sky-high growth, London seems to have reached its peak. Property growth in London will remain hard hit with price growth grinding to a halt.
According to a Reuter’s poll of 28 housing marketing specialists, property prices in London will fall by an average of 0.3% in 2018. Savills predict a 2% decrease this year, followed by sluggish growth in 2019. It could be a long road to recovery for the capital!
Boost in First Time Buyers
This year could be the year that first-time buyers are encouraged to get their foot on the property ladder. A slowdown in property price growth, a booming market in the North and the scrapping of Stamp Duty on homes up to £300,000, first-time buyers could find themselves at an advantage in the market.
At the other end of the scale, current property owners may be deterred from selling this year, looking instead to survey the economic landscape for another year to see if growth is on the horizon. Some homeowners may decide to stay put, instead opting to renovate.
Increase in Student Property
Student numbers in the UK are increasing every year, with the appetite for full-time study remaining strong despite Brexit and a hike in tuition fees.
The UK purpose built student accommodation market is estimated by property consultants, Knight Frank, to be worth a whopping £46bn. Last year, £3.1bn worth of student properties were sold – more than double of those sold in 2013 and 2014.
Investors from around the world have taken note of this demand and have been adding student property to their portfolios for the last couple of years. The investment is seen as low risk, with very affordable prices for student rooms and delivering a solid return. Student accommodation investment will definitely be one to watch in 2018.
Want to find out more about the Property trends currently hitting the UK? No problem!
Contact us today to speak with our Property Gurus.