Industry Experts? Property Market Predictions
Tue 14 Jan 2014
In the last of our series of articles on the property market in 2014, we publish the thoughts and hopes of senior executives from house builders, investment companies and estate agencies for the year ahead. Read on to see how they think the market will develop throughout the next 12 months, what the outlook is for first-time buyers in particular and what they would do if they were made Chancellor of the Exchequer for the day. What do you think will happen in the UK residential property market in 2014? Anne Cadman, regional sales director for Bloor Homes Midlands: "All the current signs are extremely good. Bloor Homes Midlands region is very busy with new enquiries, particularly for our new developments at Sutton Coldfield, Shirley & Ashby de la Zouch."
Trevor Hill, regional director of land and new homes for Connells: "The UK housing market will continue to be active in 2014 provided access to mortgages and interest rates remain stable. I also expect to see the strength of the London market in 2013 spreading out to the Home Counties as buyers who are priced out of the Capital look further afield to purchase a property. Help to Buy has had a transformational impact on the new-build market in 2013, indeed, I would say it has had the biggest impact on new homes I have seen in my estate agency career spanning over 30 years. However, housing supply remains an issue both in the new homes market, which is facing a shortage of building materials and labour, and second-hand homes where seller confidence is yet to meet buyer demand."
Peter Rollings, chief executive officer of Marsh & Parsons: "London's housing market saw a substantial uplift in 2013, and we expect a similarly strong start in 2014 to drive an annual rise in prices - but these won't be as spectacular as last year. With ongoing support from Government initiatives, the rate of growth will remain sustainable. Following improvements in unemployment levels, we're likely to see modest increases in interest rates next year. But with a general election coming up in 2015, any changes are unlikely to create shockwaves through the housing market."
Karl Hick, CEO of Larkfleet Group: "Towards the end of 2013, we saw a small recovery of the housing market with rising house prices and the start of increased confidence. I think this momentum will continue in 2014 as the demand from aspiring homebuyers will continue to increase amid a lack of supply of homes on the market. Predictably, growth will be concentrated in the south east. A broader-based recovery in the housing market will be dependent upon growth in the economy, jobs and household incomes."
Killian Hurley, executive chairman of Mount Anvil: "Every day we are seeing increasing signs of what I'd call 2007 moments'. Land being sold for inflated prices to overseas buyers; estate agents floating on the stock market; high valuations for online property portals etc. My advice is: proceed with caution and don't over-pay for land."
Alistair Brown, director at Tylers Property Partnership: "The improving economy combined with low interest rates and overseas investor demand should continue the upward pressure on capital values, the market should be monitored with extreme caution to minimise the chance of a bubble inflating- perhaps reviewing to the Help to Buy scheme in the South East and London."
Will the planned increase in house building, along with better mortgage choice, give first-time buyers (FTBs) more hope in 2014 than in 2013?
Dave Sheridan, CEO of Keepmoat: "FTBs should have more hope in 2014. Better mortgage deals are already helping and the construction of more high-quality, entry-level housing is crucial for helping people to own a nice home. To this end, Keepmoat is looking to build 10% more homes in 2014, compared to 2013."
Nicholas Spencer, sales negotiator at Henry & James: "Indeed, coupled with the soothing of the global crisis and the cessation of the flight to the safe haven of London property and the ripple effect into the suburbs, London has become a much wider market that ever before, helped in large part by foreign investment, which lacks the historic disdain for south and east. As buy-to-let investors are often the rival purchasers to FTBs, perhaps the government could examine some variety of tax relief for FTBs such as 0% Stamp Duty Land Tax and extending Help To Buy to ease the mortgage logjam. But in the main, it is simply a supply and demand imbalance that is the problem. In 2013 there was phenomenal demand, from all quarters of the globe, and almost all with cash. What hope is there for FTBs in such a perfect storm? 2014 looks to be a lot more settled."If you were Chancellor for the day and could implement one change to the property market in 2014, what would it be?
Kevin Hollinrake, Managing Director of Hunters Property Group: "I would reform the Stamp Duty rules as the current thresholds are unfair and distort the market. At the moment you pay 1% on the whole purchase price up to 250,000 (2,500) and 3% if you paid 250,001 (7,500). It would be relatively simple to introduce a new system that was more just and proportionate."
Guy Gusterson, managing director of St. Modwen Homes: "I'd increase the stamp duty threshold from 125,000 to 180,000, at a rate of 1% payable from 180,000 and 3% payable from 280,000 upwards. Most new homes of two bedrooms or more will cost over 125,000, so it would give first-time buyers a chance to make that next step without being stung by additional costs."
Alan Brown, chief executive of CALA Homes: "We still have a chronic shortage of homes in the UK. Increasing levels of house building would stimulate growth, help keep sales price inflation down and provide a boost to the wider economy. My focus would be on speeding up the planning process through local authorities which is still far too protracted."
Dick Mortimer, group director of property services at Family Mosaic: ""As Chancellor, my propriety would be to slow down the increase in market and sub market rents. This continues to raise the country's housing benefit bill and takes resources away in the long and short term from capital investment. I would also want to look at the planning application process, and to invest more resources to get housing applications through faster in order to be able to provide more, much needed housing. In London for example there are many complicated nomination restrictions that could be removed, eliminating localism' in London, making it easier for people to move across boroughs in the Capital."