Property Predictions for 2018
Russell Quirk, CEO of online estate agent eMoov, takes a look at how the housing market fared last year, the regional winners and losers, and changes 2018 is likely to bring for estate agents. Everything you need to know if you're buying or selling in 2018.
December 15, 2017
It’s been a tough year for UK property there’s no doubting that, uncertainty in the market since the Brexit vote has been further fueled by a disastrous snap election result and many sellers have either held off on their sale or had to adjust their price expectations to see it over the line.
The market this year and next
But the market has weathered the storm and prices have still seen an increase of around 4% since this time last year, despite many predictions of a doomsday style market crash.
A level of stability also seems to be returning to the market with transaction levels looking healthy and signs of more stable price growth across the board, which is promising for the year ahead.
A 5% increase in the average UK house price is a realistic expectation for the year ahead, not a return to its former glory but certainly a step in the right direction.
London has seen the most detrimental impact this year. The high price of property coupled with a fall in foreign investment in the top end of the market and changes to buy-to-let and second home stamp duty has resulted in the capital seeing the lowest growth of all UK regions.
Of course, some areas have seen much healthier growth than others, but Kensington and Chelsea has been one of the worst hit, with prices down over 8% since December last year.
While it’s likely that the top end market will continue to suffer, and remain on life support for some time yet, prices across London should see an increase of 3% over 2018.
We may see another slight adjustment to interest rates, but the affordability of mortgages, coupled with the reduction in first-time buyer stamp duty should keep demand high. This lack of supply to satisfy this UK home buyer hunger will also continue to stimulate prices and keep the market ticking over.
What about estate agents next year?
The online sector will continue to increase its market share and we are now starting to see the more traditional bricks and mortar agents try and pivot with an online offering in one form or another.
Should OnTheMarket.com float as planned, it will be a positive move for them and for the industry as a whole. While we’ve been critical of their head in the sand approach to disruption from the start, with the exclusion of online agents and their one portal rule, a float will see them drop this and we’ve previously voiced that we will be first in line to join up with them when they do.
While they have become more of a niche portal rather than a force of nature like Rightmove and Zoopla, a more transparent approach will result in greater choice for agents, healthy competition for the portals and more importantly more choice for the consumer and the assurance that their property will be listed on all of the key sites, which is of course a good thing.
Finally, 2018 could be the year we see the implementation of licensing and regulation of the estate agency industry.
The Department for Communities and Local Government eluded to it a few weeks back and stated they wouldn’t need primary legislation in place before implementing it. Despite an improving image largely driven by fixed fee, service based agent, the industry is still crying out for proper regulatory standards and it’s something that we have been fully in favour of and called for on numerous occasions.