House prices will flatline on average across the UK next year, Rightmove has predicted.
The portal says that prices in more buoyant northern parts of the UK will rise by between two and four percent but that London and in particular its commuter towns will see price reductions of up to 4%, dragging the average down to 0%.
Despite this gloomy outlook for the New Year, Rightmove’s housing market analyst Miles Shipside (pictured) reckons the fundamentals supporting the housing market are sound including high employment levels and low interest rates.
“Buyer sentiment has been helped by recent interest rate rises not being fully passed on, which may continue to be the case with any future base rate rises as long as healthy competition remains among lenders keen for new business,” he says.
“The Mortgage Market Review established in 2013 has also been a limiting factor on excessive property price increases by prudently restricting buyers’ borrowing power.
“Agents in some locations are reporting that home movers are being negatively influenced by the ongoing political uncertainty, and a more certain outlook would obviously assist market sentiment.
“Whilst uncertainty traditionally deters some discretionary movers, particularly at the high end of the market, there are many would-be buyers and sellers who will be getting on with their lives and will be keeping the market moving.”
Shipside’s comments echo today’s Halifax house price index, which shows prices already edging close to zero at 0.3% year-on-year as both its quarterly and monthly figures are revealed to be negative at -1.1 and -1.4% respectively.