Price growth forecast suggests a slowdown in 2018
Recent statistics suggest that house price growth could drop to 1% next year.
This is according to estate agency Knight Frank which predicts a continuation in the decline which began in 2014; however, they still forecast house price growth reaching 14.2% between 2018 and 2022.
Whilst London prices in 2018 are expected to see a decline of 0.5%, the longer term prediction is much more optimistic at 13.1%. This is the anticipated cumulative price growth over a period of five years.
On a general basis, the estate agency believes that prices will remain subdued in 2018 – something which has mainly been attributed to uncertainty across both political and economic markets.
However, this may not be the case for all regions, with the predictions suggesting that price growth may be stronger in the North West, the Midlands and the East of England.
Commenting on the price growth forecast for next year, Knight Frank stated: “Once the Brexit deal is completed, we forecast rising momentum across the market, with price growth reflecting this in many locations.
“The UK may now be entering a period of interest rate rises, but even so, we expect rates to be low compared to long-term norms by the end of the forecast period.
“While development levels are rising across the country, the shortage of new homes is unlikely to be fully reversed in the coming years, and that will underpin pricing. On the other hand, factors such as deepening affordability pressures and property taxes, will continue to weigh on pricing.”