Here at Agile we like to keep you up to date with all the latest property price news. It’s our job to know what’s going on in the market at both a local and national level. So, with that in mind, here’s what’s been happening in the last few days.
Average house prices are set to rise by around 14% over the next five years, according to the latest forecast by real estate firm Savills. Over the next twelve months prices look set to stabilise a little bit owing to uncertainty surrounding Brexit and other factors, but they should pick up again around 2019/20 towards 2022. This forecast is based on the assumption that the Bank of England’s base rate will reach 2.25% by 2022 and that average mortgage rates will reach 4% by the same time.
However, Savills are also predicting that there will be large regional variations in price rises. This is good news for people who own property in the north west, with rises of around 18% expected. However, in London, where prices have been astronomical and growing for some time, the growth rate is set to slow to just 7%. This would realise a trend that has long been predicted – namely that high prices in London will drive potential buyers elsewhere, which in turn means these other areas show house prices that grow to keep up with the capital.
This has already occurred in Norwich and Norfolk more generally, where there has been regular and stable growth in the property market over the last several years. Norwich has become very attractive to people leaving London, with the universities, good transport links and a good housing stock all appealing to investors.
A breakdown in the house price rises predicts growth of 2% over 2017, 1% in 2018, 2.5% in 2019, 5% in 2020, 2.5% in 2021 and 2.5% again in 2022. Lucian Cook, head of Savills residential research department, said: ‘Uncertainty over what Brexit means for the UK economy and how it will impact household finances will increasingly act as a drag on house prices. There is capacity for growth once we have greater clarity, but this will be constrained by rate rises and the corresponding ability to get mortgage debt, particularly in London and other higher value locations.’
Adding: ‘Mortgage regulation, introduced in 2014, is likely to show its hand as interest rates rise. But by restricting the amount people can borrow, it will take the heat out of the market and so reduce risk now and in the future.’
So, despite some rumblings in the market, it seems like now is still a great time to invest. Get in touch with us if you’d like to know more.
To find out more about the local and national property market, or if you would like to chat about anything to do with property investment, give us a ring on Norwich 01603 567804 or send us a message.
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