After five tough years for estate agents, 2013 finally saw the property market spark into life.
The Help to Buy mortgage guarantee scheme certainly generated much-needed activity among first-time buyers.
This in turn has prompted movement further up the ladder.
As a result, prices have, on average, increased - although the word average is important to put into context.
In short London continues to drive growth in the property sector, although the overall picture is more complicated than that. On a percentage basis, price rises are generally far stronger in the capital than anywhere else in the country.
These price rises are further skewed when high-end properties in the capital are taken into account as prime and super prime property remain in their own isolated growth bubble.
When all these are combined they provide a distorted picture of the real state of UK house price growth and market activity.
Yes prices are indeed rising and this is a relief after so many years of inertia - but generalised percentages do not tell the full story.
London's growth is impressive in the main but it is not the same story across the rest of the UK where price and sales increases are less marked - Manchester excepted, where there has been a large increase in the last 12 months.
A number of respected organisations have predicted even greater house price growth through 2014 but is 10%+ really achievable - or desirable - over the next 12 months?
Looking in our EAT crystal ball we believe the figure will be less than this when the UK is considered as a whole - and there are caveats.
Help to Buy has reinvigorated the market from the bottom up but this needs to be sustained for its impact to really push the market forward.
Remember, all this is taking place at a time when interest rates have never been lower - they can only go up. If they do, the impact depends on how much they rise.
Most likely, any increase will be small but it could limit market recovery while still in its infancy.
Interest rate rises have been predicted for every one of the last seven years they have been pegged back but this year an increase seems more likely than at any other time - and they will have to go up at some point.
Another key influence for 2014 will be 2015 - the year of the next general election.
Over the coming 12 months, all the main parties will be working on their election manifestos - and this means policy ideas for the economy and housing market.
Quite what these will be is as yet unclear but a mansion tax will almost certainly appear somewhere along with a raft of other proposals which could have the effect of stalling recovery before it gets going.
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Comments
@ rantnrave on 2014-01-07 13:25:20
Please don't go on to thruppence! ;>)
Hi Jonnie
Thought I'd leave it a while before replying - don't want to take too much away from the discussion about Ros' unannounced departure. She did indeed do a good job and it seems sad to not even acknowledge that.
Round my way, the Land Reg had annual prices down at 5% over the summer. That momentum all changed with the news that HTB was being brought forward. Stock dried up and anything new to the market seems to have a 20% funny-money price hike already factored in. At this rate, I'll soon be unable to call myself a cash buyer for what we're after. I'm certainly not about to storm the pier and catch any departing boats though.
Much of the recent price rises I put down to the FLS scheme. With the mortgage part of that ending this month, I think we've reached the low point of mortgage rates and that will affect prices going forward. New international banking regulations kick in from April and the rate that UK banks can borrow internationally has hit a several-year high. That will all filter through to mortgage rates and ultimately to prices in my opinion. HTB remains a wild card though and an ill-conceived one at that. That's my tuppence.
It may get busy if we had any stock to sell!
Being a bit busy with simultaneous exchanges and completions on 23rd December (I wonder if something to do with so many solicitors being forcibly closed down by the Law Society on the 29th) I knew nothing of dear Ros's departure from EAT until this morning!
The business will surely miss her topical and always up- to-date insight into what's going on! If we had had to rely on NAEA, RICS, TPO etc. for news on legislation over the last few years most of us would have been practicing from Clink by now. Thank you Ros for a job extremely well done and for an act that will be very hard for anyone else to follow - even Henry Pryor perhaps!
My guess is a pantomime will ensue in early 2014, oh yes it will!
Big T
Impartial and fair?
Hmmmm guess all the product placement and editorial / advertisments that are "News Stories" have all passed you by.......
We are having an amazing start to the year! 2014 is going to be AMAZING!
So what happened to Ros? No-one knows and no-one is saying.
Then said
"not that it will make much difference" you are quite wrong there, Ros Renshaw was able to spot questionable stories from folk who didn't ought to be allowed to trade and denied them the publicity they sought.
@rant,
Happy New year and all that. Another year starts then?
How are things in your area / where you are looking to live? – is the sale price of the sort of thing you’ve had your eye on come down in the last 12 months? If so by how much and how much more are you looking for before taking the plunge?
I agree the ‘young Mum’ getting on the ladder with the HTB being a franchise of Enfields was a bit daft but shes probably fairly middle income, seems the right sort of age etc just her occupation made it all whiff a bit
Jonnie
So what happened to Ros?
not that it will make much difference but was wondering!
Who is 'E Daniels' ?
Surprised not to see the story here that Cameron's right-to-buy poster girl has been revealed to be an estate agent - who sold the flat to herself.
http://www.dailymail.co.uk/news/article-2533994/PMs-right-buy-poster-girl-revealed-estate-agent-sold-flat-herself.html#ixzz2pbtefZ1s
They can't remove the negative comments on the Help to Buy Facebook page (yes - it really exists) fast enough:
https://www.facebook.com/photo.php?fbid=233807786801930&set=a.159564610892915.1073741828.159201874262522&type=1&theater
Careful Peebee Thanking Ros for her efforts has already been desribed as inappropriate.
@ PeeBee on 2014-01-06 09:07:56
I fully agree with your comments.
Something seems to be wrong here.
Good luck Rosalind - wherever you are.
Well... the name at top of the page has changed, so I take it that the 'leak' from Mr Pryor is correct and that Rosalind is no longer with us.
Goodbye, Ros - it has been a pleasure to be a 'pen-pal' of yours for the last few years.
Whoever is filling your shoes has a huge task.
I would respectfully suggest they start by actually acknowledging your departure and thanking you for your excellent work on this site...
The BBC has talked up the London and south East market quite nicely thank you just in time for their respective moves to Manchester and Birmingham, meanwhile the rest of the country just tags along.
How long will it be before the inflationary pressure caused by rising house prices along with the drop in unemployment results in a rise in interest rates? I feel very sorry for anyone who gets suckered into buying on the base of help to buy where prices are being artificially forced up just like the psuedo sales at DFS.