2014: A Look Ahead At The Property Market
As we begin this New Year we take a look at what to expect over the next twelve months in the property market.
Nationally the main theme of 2014 will be the continuation of rising prices in the UK property market. During 2013 house prices nationally rose 4.4% (source: Hometrack) and rose 1.4% in December alone (source: Halifax).
However despite these positive national statistics closer to home in the north east, where we operate, there was a slight annual price fall of 1.6% with the average price now standing at £96,227.
Looking forward, optimistic predictions for the national market in 2014 expect house prices to rise as much as 8% (source: The Guardian). For most 2014 will herald growing positivity and confidence in the property market and wider economy with many, in both the consumer and business circles, adapting to the new economic world and simply “getting on with things”.
Help To Buy
The Help To Buy scheme will continue to assist first time buyers to grasp the first rung of the property ladder. This scheme was launched last year in two parts with the second part launched early in October by the Prime Minister David Cameron to help boost the property market.
Help To Buy has been credited in generating circa 75 new homeowners per day within the property market, each taking advantage of the need to only raise a 5% deposit against their new home.
There have been doubts about the scheme that it would create a London-centric housing bubble but these were dismissed at the weekend by the Prime Minister and with more mortgage providers expected to join the scheme in 2014 it should help contribute to the momentum of the market.
The rental market is also expected to experience continued growth in 2014 following on from last year where rental values rose 4.2% nationally (source: Countrywide). This trend of growth isn’t likely to be temporary with predictions that by 2021 over 20% of all UK properties are expected to be rented privately, bringing the UK in line with other European countries.
Following the launch of the Help To Buy scheme last year it was thought that this would have a negative impact on the rental market as more renters seek to buy for the first time under the new affordable scheme. However despite people in rented accommodation wanting to purchase a home in reality some will take time to save up deposits whilst others are simply priced out of buying even with the Help To Buy scheme. Due to factors like these as well as other “lifestyle” factors it is envisaged that there won’t be any fall in the rental market as some had feared.