Jackson-Stops predicts that average UK house prices will remain flat in 2018, with stamp duty, Brexit and political uncertainties taking their toll on the market.
The agency says house price growth in London will remain stable across 2018, with higher value homes (£1m-plus) continuing to feel the strain of stamp duty.
“Prohibitive levels of stamp duty land tax have been a real drag on the UK property market over the last financial year and although the Treasury will be pleased to see SDLT receipts have generated £8.6 billion in revenue on residential transactions, sales levels fell by eight per cent” says Nick Leeming, Chairman of Jackson-Stops.
He warns that without some stamp duty reform at the top end of the market, 2018 will see a repeat of this year’s lacklustre performance in prime central London.
Leeming says once the Brexit ‘pathway’ becomes clearer there may be more transactions, but he warns that the rental market in particular may be hit “as foreign employers start to seriously consider whether to relocate their staff to locations such as Dublin and Frankfurt.”
There is somewhat better news in the country market, where Jackson-Stops says the middle market (homes valued at £500,000 to £1m) could see rises in 2018 of up to four per cent in popular areas such as the westcountry.
However, the agency warns that some commuter locations around London are struggling and sellers may have to reduce their expectations if they want a quick sale.
“Decent levels of demand will come from families moving out of London in 2018, after finding their homes in the capital are no longer making more money than them” says Leeming.