No ‘property Armageddon’ in 2017, says NAEA

No-one could have predicted many of the political and economic events of this year, but the NAEA and ARLA have had a go for 2017.

Both have released predictions for the next 12 months based on member surveys.

NAEA members are backing house price inflation to be flat but are predicting this will help first-time buyers, with 29% forecasting that sales would increase.

They are also hoping for a shift in focus to those buying older properties: ‘fixer uppers’ are better value for money in the long term.

Mark Hayward, managing director of the 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.”

The picture isn’t looking so good in the rental market.

ARLA predicts the number of new rental properties coming on to the market will fall next year as a result of the increased stamp duty surcharge on additional properties, with 37% of agents envisaging supply falling.

Just over half of member agents expect rent prices to increase in 2017 as lower stock levels, combined with mortgage interest relief and the ban on letting agent fees, will put upward pressure on rents.

Agents are also predicting landlords may be forced to sell some or all of their buy-to-let properties and exit the market, while for prospective new investors it will be more difficult to obtain funding.

David Cox, managing director of 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.”

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5 Comments

  1. AgentV

    Did they say anything that we don’t already know?

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  2. Property Paddy

    I think we will have an increase of property for sale and apart from London and it’s immediate neighbouring counties I think we will see house price inflation and an exodus of buyers away from London areas.

    If you are a country agent I think you will see an increase of buyers out of London. They will be selling up at more realistic prices to move their lives on rather than holding out for every penny.

    It’s my prediction. I am probably gonna get people saying utter bull.

    So we will have to wait and see, wont we.

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    1. londoneye

      The exodus from London depends on them selling in London first! Rather than reduce prices my guess is that they will leave things for another years. With so much going on in the UK, Europe, the US, 2017 is going to be a quiet year. Knight Frank report that prices have fallen in Chelsea by 16% this year. What this means is that less people want to sell and we have a total stalemate. Time to go on holiday!

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    2. AgentV

      Out in the sticks…well the second city area, we have been seeing more and more buyers relocating from London for the past three years. The biggest comment is that if they want to move they cant afford the next step!

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      1. AgentV

        Sorry should read;

        The biggest comment is that if they want to move in London they cant afford the next step!

         

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