2016 was an unsettled year for the housing market, with the unexpected Brexit bombshell causing widespread doubt about the political and economic future of the country. Add the major changes in stamp duty introduced in April, and the climate was one of indecision and insecurity. With the New Year on the way, the movers and shakers of the property market are starting to forecast what might be in store for 2017. Here’s some of what they’ve come up with so far.
1. Continuing uncertainty
The tremors of the Brexit earthquake will continue to unsettle any major trends in the housing market in 2017. The predicted triggering of article 50, and general ambiguity about what this will mean for the economy, will mean a continuation of the climate of insecurity that has governed much of the last year in the UK.
2. A slight rise in prices
Nationwide, house prices are predicted to rise by around 3% over 2017, according to the Royal Institution of Chartered Surveyors. East Anglia, the North West and the West Midlands predict greater rises than the national average.
3. Affordable new housing
The ongoing problem with the lack of affordable housing available, especially for younger buyers, is due to be addressed in 2017. MP Sajid Javid spoke out about the unacceptability of the lack of affordable housing, saying that the major developers, who dominate the new build market, needed new incentives to follow through on the permissions they had obtained and actually build enough new houses to make them affordable for first time buyers. There is now planning permission available for 476,000 homes that remain unbuilt, a record high. Javid says “We need to follow the example of countries that use factory-build and custom-build houses. Above all, we need to make sure we provide the right incentives to diversify.”
4. Reduction in buy to let
The major changes in stamp duty in April 2016 has led to a number of changes, not least major disruptions to the buy-to-let market in the UK. The number of new and outstanding buy-to-let mortgages has decreased from a high of 29,300 in March 2016 to 6,200 in October, a trend that’s likely to continue as property investors are put off by the new taxes on letting out properties that they own.