Which property markets in the UK are predicted to see slower growth in 2017?

The close of one year is often a time for both reflections on what has gone by in the past year and on what the next year will bring. In terms of the housing market, that seems likely to mean slow house-price growth, but growth nevertheless. Here are some reasons for this prediction.

The laws of supply and demand still apply

The UK as a whole has a shortage of housing in general and lower-priced housing in particular. This shortage is most acute in and around London, but can be felt in other parts of the UK. Where demand is higher than supply, prices increase. The extent and speed of the increase can be influenced by a variety of factors.

Brexit

It’s the elephant in the room and at this point nobody knows whether it will turn out to be a reasonably friendly elephant or a rampaging and destructive one. In a worst-case scenario it could see an exodus of EU citizens without the return of UK expats. In the real world, however, just how likely is it that this will happen? Even if it did occur, would it actually impact the housing market so much that house-price growth would cease completely? At the moment, these are all hypothetical questions, what is, however, a fact is that the UK employment market is massively more flexible than its European counterparts. This has obvious attractions to companies looking for a place to do business, which in turn drives demand for housing.

Interest rates

The Mortgage Market Review of 2014 and the more recent rules brought in by the Prudential Regulation Authority both aimed to ensure that mortgage borrowers would be able to manage their mortgages in the event that interest rates rise. Given how low interest rates are at the moment, realistically, the only way they can move significantly is in an upward direction. If this were to happen, then it could well put downward pressure on house prices and create opportunities for investors with available cash. At the same time, however, even if inflation rises, it’s questionable whether it would be politically acceptable to raise interest rates significantly, given how this would affect both mortgages and consumer debt.

The value of the pound

A falling pound is great news for international buyers looking to diversify and eager for a slice of the UK’s profitable housing market. London has long been known for its popularity with international investment purchasers. There are all kinds of opportunities from new-build developments (particularly ones which stand to benefit from the infrastructure upgrades promised in the Autumn Statement), to looking for property restoration projects to the old staple of buy to let.

Emphasis on income

Seeing the value of a property portfolio rise on paper can be a pleasant feeling, but in reality this value is only realized as, when and if you sell a property. Income is what keeps the wheels of life turning smoothly in the here and now and the smoother that income stream, the smoother the wheels turn. This has long been the attraction of buy to let and is also the reason why investment options such as commercial property and special-purpose property such as retirement or care homes is now seeing a lot of interest from investors.

EAN Content

Content shared by this account is either news shared free by third parties or sponsored (paid for) content from third parties. Please be advised that links to third party websites are not endorsed by Estate Agent Networking - Please do your own research before committing to any third party business promoted on our website. As an Amazon Associate, I earn from qualifying purchases.

You May Also Enjoy

Estate Agent Talk

Non-standard home insurance cover and how to get it right

Leading insurer provides the low-down on non-standard home insurance cover and how to get it right Most home insurance policies in the UK are designed for ‘standard’ homes, but not every home is considered standard. Whether the property is built with timber frames, has a flat roof or is a listed building, it may fall…
Read More
Breaking News

Should you change mortgage lender?

The latest research from award-winning mortgage adviser, Alexander Hall, has revealed that more than half of homeowners approaching the end of a fixed-rate mortgage are currently undecided on their future with their mortgage lender, despite notable improvements across the mortgage market over the last 12 months. The consumer insight, commissioned by Alexander Hall, surveyed 1,035…
Read More
Breaking News

Property chains cost movers £2,000 in unexpected costs

Property ‘chain reactions’ add over £2k to moving costs on average Nearly half of home buyers who have been in property chains say they experienced delays or transaction breakdown because of related issues Problems with chains have led three in 10 to put off future moves, while one in seven say they’d only consider a…
Read More
Breaking News

Rental demand remains resilient in 2026

The latest research from Benham and Reeves has found that around a quarter of all rental homes currently listed across Britain have already secured a tenant, highlighting continued underlying demand despite ongoing regulatory uncertainty. Benham and Reeves analysed current rental market listings to highlight current rental demand, the size of rental properties currently most in-demand…
Read More
Breaking News

Buy-to-let lending growth matches FTBs and homemovers

The latest market analysis from Alexander Hall has revealed that buy-to-let mortgage lending has grown at an average quarterly rate of 7% over the last year, matching the pace of growth seen across both first-time buyer and home movers, as improving mortgage market conditions continue to support borrowing demand for rental properties. Alexander Hall analysed…
Read More
Rightmove logo
Breaking News

Prices stand still in February but still strongest start to a year for prices since 2020

The average price of newly listed homes for sale is virtually flat in February , down by just £12 (-0.0%) to £368,019 Despite the standstill in prices in February, January’s record asking price increase for the time of year means that it is still the strongest start to a year for asking prices since 2020,…
Read More