Forecast of the UK property market by 2016

The housing market in the UK experienced in December 2015 with a deep failure since 2006.

Traditionally, the seasonal feature of December is that the prices are slightly falling in the run up to Christmas and new year holidays. This is primarily due to the fact that managers in the real estate agencies are closing their annual balance sheets and try to conclude as many transactions at the end of the year to get good bonuses.

However, this year, according to data presented by Rightmove, the fall in prices in December was 1.1%, much more than the usual seasonal drop. Falling prices in December – a consequence of improvements in accessibility of new housing, and the increase in Stamp duty for “buy to let” investors.

Looking ahead, it is expected that in 2016 the demand for housing will increase. This is especially visible in cities such as Leeds, Edinburgh, Manchester and Cardiff. Already, there has been a marked trend, as highly skilled professionals from London are moving to the city, attracted good salaries.

In the same year, despite the contraction in prices, the overall price increase since the beginning of the year was 7.4% , which in absolute terms is almost £20,000 and reached an average value of £289452. Early 2016 will be marked by a surge of activity with investors and “buy to let”, which will try to expand their investment portfolios before the deadline of 1 April 2016. However, we must bear in mind that really the time allocated for this transaction investors remained much smaller – to mid-February. Since the process of registration of the property takes at least 6 weeks.

The following year, the demand for residential property in the UK will podstegivaniia such schemes like “help to buy” and, according to preliminary estimates, the price of housing by the end of 2016 will grow at an average of £17000.

From April 2016 we might witness some easing of price growth, associated with an increase in stamp duty for investors 3%. However, demand will be supported by first-time buyers buying a house, which provides comprehensive support to the government and the lack of new objects for sale. Traditionally, a huge role in the price formation in residential property market in the UK will play the local dynamics of supply and demand.

® Helen Entree. 13.12.2015 G.

Price indices for UK property

Index index

Index Rightmove

Index Office for National Statistics

Index Nationwide

Index LSL Property Services Acadametrics

The Index Of The Land Registry

Index Hometrac