Clearview National February 2017 - Issue 183 | Page 73

BUSINESSNEWS

Annual housing market forecast

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HOUSE PRICES IN THE UK will see an average increase of 3 % over the course of the next year as the number of transactions stabilises , according to the RICS housing forecast for 2017 .
Following on from the 2016 forecast , the supply pipeline or lack of it is at the forefront of the analysis and dominates the residential market . While there is an improvement , the legacy of building on an insufficient scale has left the average inventory on estate agents books close to a historic low .
Looking forward , transaction activity will stabilise and is likely to come in between 1.15 and 1.2 million , a little below the 1.25 million likely to be recorded for the whole of 2016 . The prediction for 2017 reflects the trend over recent months . East Anglia is likely to continue its trend during 2016 and alongside the North West and West Midlands is likely to
record gains higher than the national average . Meanwhile , prices in Central London look set to stabilise after recent declines , with support provided by the weaker exchange rate encouraging foreign buyers .
Simon Rubinsohn , RICS Chief Economist , commented : “ Although recent announcements by the government on housing are very welcome , the ongoing shortfall of stock across much of the sales and lettings markets is set to continue to underpin prices and rents . As a result , the affordability challenge will remain very much to the fore for many . Meanwhile the lack of existing inventory in the market is impacting the ability of households to move and will contribute toward transaction activity over the whole of 2017 being a little lower that in the year just ending .”
Jeremy Blackburn , RICS Head of Policy , commented :
“ The Housing White Paper will be a defining moment in January , to see if more radical thinking in Whitehall is a reality . The proposed ban on lettings agents fees , and the unintended consequences of such a blunt policy , will also be a strong feature of the year ahead .
“ Whilst the system based on large , private housing developers and homes for owner occupation has increased house building , it ’ s not delivering . The UK needs a co-ordinated strategy for building across tenures , using all of the delivery and technology mechanisms at our disposal .”

STARTER HOMES A GOOD FOUNDATION

The Government announcement , which gives the green light for the construction of thousands of Starter Homes , is welcome but greater challenges lie ahead if we are to solve our housing crisis , the Federation of Master Builders ( FMB ) has warned .
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BRIAN BERRY , CHIEF EXECUTIVE of the FMB , said : “ It ’ s great to see the Housing Minister kick off 2017 by giving the green light to the first Starter Homes . These homes will help some first time buyers get a foot on the housing ladder , and our small house builders are enthusiastic about delivering on that vision , but starter homes will not be a panacea . A wider set of measures aimed at increasing the capacity of the house building industry are needed to overturn the longterm under-supply of new homes . Central to this must be getting small and medium-sized ( SME ) builders delivering more new homes . For instance , the announcement of 14 ‘ garden villages ’ and more garden towns needs to be backed up by implementation plans , which provide opportunities to SME builders as well as the large companies .”
Berry concluded : “ These are positive messages to start the year with and they show that the Government is putting house building at the front and centre of its ambitions for 2017 .”
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