It looks as though forecasting the UK property market in 2017 will prove as difficult as forecasting political results in 2016. A number of experts have stepped forward to explain their forecasts for next year and while they vary enormously each one can quite easily be justified. So, what are the experts saying about the UK property market in 2017?
Royal Institute of Chartered Surveyors (Rics)
The much respected Rics is forecasting an increase in UK property prices in the region of 3% during 2017. Despite a number of challenges over the next 12 months Rics is also forecasting a stabilisation in transaction numbers which is interesting. When looking at particular areas of the UK, East Anglia, the North West and West Midlands are set to fare better than most and London will stabilise after a difficult few months. The relative weakness of sterling over the last six months will also attract a greater number of overseas investors during 2017.
Nationwide Building Society
The Nationwide has been relatively successful over the years in predicting the short term direction of the UK property market. During 2016, using the Nationwide index, UK house prices have increased by anything between 4% and 6%. This was in line with the forecast for 2016 and therefore many experts and investors give greater credence to words of advice from the Nationwide. So, what is the Nationwide forecasting for 2017?
Interestingly it is forecasting an increase of just 2% in UK property prices over the next 12 months. Citing a number of difficult variables, surrounding politics and the economy, the Nationwide would appear to be a little concerned about the current state of the UK property market. It will be interesting to see whether next year’s forecast is as accurate as those of recent times although in reality an increase of 2% is better than many are forecasting.
Estate agent Savills is a little more cautious on the UK property market predicting a relatively flat market during 2017. As we highlighted above, it is proving more and more difficult to forecast movements in the UK property market in light of volatile variables such as Brexit. The company has however highlighted the East of England and the South-East as areas of interest for investors with forecast growth of 2.5% and 2% respectively. While others have been focusing on the North of England, Savills believes that Scotland and the North-East of England will see house prices fall by 2.5% during 2017.
In a perfect example of different expectations for 2017, Hometrack is forecasting growth of 4% although regional variations could be extreme. The company believes London will see nominal growth which will be offset by significant growth in some of the U.K.’s larger regional cities. Whether this is the beginning of a move away from London to the more “value driven” regional areas such as Manchester and Birmingham remains to be seen. This is something which has been discussed on numerous occasions though has yet to really emerge as a long-term trend.
There is an array of other companies forecasting a dip in the UK property market during 2017 but the general consensus seems to be anything between growth of 0% and 5%. We will see………