After a year of political surprises and economic uncertainty, National Association of Estate Agents (NAEA) and Association of Residential Letting Agents (ARLA) share their predictions for the property market, looking ahead to 2017.
NAEA’s predictions and hopes for 2017, from Mark Hayward, managing director:
There will not be extensive house price inflation in 2017 and the number of transactions will remain steady; almost half (43 per cent) of member agents expect prices to stay the same.
As house price inflation stalls, first time buyers (FTB) should find it easier to enter the market. Encouragingly, almost a third (29 per cent) of NAEA agents think sales to the group will increase.
While help for FTBs is currently focused on new builds, we should now focus on helping the group buying older properties; ‘fixer uppers’ are better value for money in the long term.
Each and every time the Government defines its new house-building targets, we applaud their efforts, but we still haven’t seen a significant increase in the number of properties being built. We need to see these promises converted into bricks and mortar for a better housing market for all.
ARLA’s predictions and hopes for 2017, from David Cox, managing director:
The number of new rental properties coming onto the market will fall next year, as a result of the increased stamp duty surcharge on additional properties; over a third (37 per cent) of agents envisage supply falling.
Over half (52 per cent) of member agents expect rent prices to increase in 2017. Lower stock levels, combined with mortgage interest relief and the ban on letting agent fees will put upward pressure on rents.
Demand will continue to rise, and with less stock available for prospective tenants, competition will be high in 2017.
Due to the rise in landlord taxes in 2016, landlords may be forced to sell some or all of their buy-to-let (BTL) properties and exit the market. For prospective new investors, it will be more difficult obtain BTL funding in 2017, as lenders up their criteria.
Mark Hayward, managing director, NAEA, said: “It would be an understatement to say this year has not gone as expected. However, the property market is mostly still feeling the effects of events which happened last year.
"The high end London property market is suffering at the hands of increased stamp duty taxes, and while Brexit uncertainty definitely hasn’t helped repair this, it’s not the sole reason why London’s more expensive properties aren’t being snapped up at the same speed they were.
"Next year, we expect it’ll be more of the same; there won’t be a ‘property Armageddon’, but things won’t get much better for first time buyers, and those looking to up or down-size.”
David Cox, managing director, ARLA, said: “Our private rented sector report findings over the past few months have been positive and we were confident approaching the end of the year.
"However, following the announcement of an outright ban on letting agent fees during the Chancellor’s Autumn Statement, we expect rent prices to rise and tenants to be forced to look for properties in cheaper areas.
"The government continues to lash out against the private rented sector to cover its own failure to build the number of homes this country needs. Such policies will have a detrimental effect on the very people the Government aims to help the most.
"As a result, we predict 2017 will be a raw year for renters. We now need stabilisation from the government before tenants are squeezed dry of every penny.”