A lack of Housing supply will continue to support the level of price growth says Countrywide
A recent news release from Countrywide contained their Housing Market Forecasts, published on the 21st August 2017 the news released headlined ‘Price growth to slow to 1.5% in 2017, but increase to 2% in 2018.
They expect average house price growth in Great Britain to fall to 1.5% in 2017 compared with 5% in 2016. While the first half of 2018 is likely to be more difficult, they forecast prices to end the year 2% higher. By 2019 they expect house prices to be growing at an annual rate of 3%.
They state: Despite little recovery in the levels of housing transactions – due to affordability issues and fewer buy-to-let purchases – the rate of new building is not expected to gather enough pace over the next two years to catch up with previous shortfalls. A lack of supply will therefore continue to support the level of price growth.
Fionnuala Earley, Countrywide’s Chief Economist, said:
“Economic conditions for households will remain challenging over the next year as inflation eats into budgets and interest rates begin to rise. In addition, fewer landlord purchasers and the later age at which people buy, is affecting the level of demand. But we expect the UK economy to recover and wage growth to pick up in response to global growth. That, combined with a continued lack of housing supply, will help to support house prices.
“The housing market is sensitive to confidence which will be affected by the outcome of Brexit negotiations and the implications this will have – particularly on employment.”
Read the Countrywide Housing Market Forecast in full click here.