In its latest quarterly market report, real estate firm Strutt & Parker declared a positive outlook for the United Kingdom housing market this year, despite some challenges.
Alongside its economic advisors Volterra, the British estate agent is forecasting U.K. house price growth will be 5.0 percent in 2015. The figure in the Greater London area is predicted to be significantly higher at 9.0 percent, in contrast to prime central London where no growth is expected at all.
Stephanie McMahon, Head of Research at Strutt & Parker, said: “There still lies an imbalance between London and the rest of the U.K., but there are signs of strong recovery in the regions as buyers outside the capital look for affordability.
“The holding off of interest rate rises, now not expected before autumn 2015 at the earliest, is a big positive.
“This, combined with continued wage growth – U.K. real wages and living standards began to recover for the first time in five years in December, and low inflation, should give the national market the momentum it needs.
“We should see a flurry of activity up until the autumn as buyers take advantage of the low interest rate environment,” she concluded.
UK House Price Growth
As part of the research report, Strutt & Parker analysed the behavioural profiles of its buyers who purchased country homes in the £2 million plus market outside of London throughout 2014.
It was clear that the majority were buying a large country home for their primary residence (79 percent), rather than for a second home (13 percent) or for investment (8 percent).
This could be linked to the increasingly high cost of buying and moving – meaning that people are choosing to buy one large house rather than two smaller ones or numerous buy-to-let investment properties.
James Mackenzie, Strutt & Parker’s Head of Country Department, said: “The beginning of 2015 has seen a significant increase in new applicants registered with us looking for prime properties ‘in excess of £2m’.
“We are witnessing at least double the amount of potential purchasers enquiring about properties we are currently offering or are bringing to the market. However, our viewing levels are not higher, which would indicate that there are a significant number of people who are beginning to look at moving but are waiting to see what the market has in store for this year.”
“Last year saw a significant increase in the number of transactions compared to 2013 especially in the regions outside of Greater London, as well as in Scotland, both of which recorded 7.8 percent and 11.6 percent growth respectively.
“Guy Robinson, Head of Regional Residential Agency at Strutt & Parker, said: “Given the pending election, we are pleasantly surprised at the levels of activity, most specifically in those areas closest to London, in the sub £2 million market.”
Andrew Batt, International Group Editor of PropertyGuru Group, wrote this story. To contact him about this or other stories email andrew@propertyguru.com.sg
