Mark Hayward, managing director of the National Association of Estate Agents (NAEA) provides an overview of what we may see in the housing market in 2015
NAEA predicts that in 2015 the industry will see the country catching up. In the coming year, London and the South East will show slower growth in terms of price.
With stamp duty reforms now in place, we’re hoping for greater supply in the market nationwide as there’s more encouragement for people to buy and sell houses.
Areas outside London and the South East, where the market has been slow in terms of volume and price, will hopefully catch up with London and the South East in the next year.
We’re hoping to see a greater supply of housing in the market in 2015, but at present, our skills supply – in terms of construction – is too low to be able to meet housing market demands.
Although the number of new homes being built has risen, and the three main political parties have created large new-build targets, the lack of capacity within the market means that the gap between supply and demand won’t close – we currently don’t have the resources to respond to the problem.
A General Election will always cause uncertainty, whichever party is likely to come in to power and with the housing market being based solely on sentiment, any uncertainty may result in a temporary lull. However, we don’t believe this will have long-lasting implications on the market.
Finally, we’re expecting to see a base rate rise next year. At present it’s anticipated to rise in the latter part of 2015, and the Bank of England feels this will have little effect on current mortgage holders and first time buyers.
However, our research among NAEA members suggests the impending rate rise will influence demand, with 70 per cent of agents already reporting signs of demand dropping. It is likely that the imminent rate rise will continue to affect demand, as well as affordability.
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