2017 will be an interesting year for property across Manchester. It will be a year that will include a lack of homes being constructed due to a funding shortage, annual price inflation carrying on despite the ever-looming fears of Brexit and landlords also being targeted by the Government.
2016 saw a rollercoaster year for the property market. The annual house price inflation slowed somewhat towards the end of the year but all signs were pointing towards inflation rates still increasing. Areas around London were experiencing the largest surges where prices were reaching all new highs, but Manchester was also feeling the pressure of a fluctuating housing economy.
House prices are set to increase by as much as 3% by next year. This prediction was made by the Royal Institution of Chartered Surveyors which said they believe the number of transactions will stabilise. They also believe that property prices will rise in each region of the United Kingdom this year, with East Anglia, the North West and West Midlands having much higher gains that what is considered to be the national average.
The chief economist of the Royal Institute of Chartered Surveyors, Simon Rubinsohn, said that: “Although recent announcements by the Government on housing are very welcome, the ongoing shortfall of stock across much of the sales and lettings markets is set to continue to underpin prices and rents.”
“As a result, the affordability challenge will remain very much to the fore for many. Meanwhile the lack of existing inventory in the market is impacting the ability of households to move and will contribute toward transaction activity over the whole of 2017 being a little lower that in the year just ending.”
Over 2016, Nationwide Building Society said that the house price growth ranged between 4 to 6 percent. Robert Gardner, the chief economist at Nationwide said: “Survey data indicates that, while new buyer enquiries have remained fairly subdued, the number of homes on the market has remained close to all-time lows, in part due to low rates of construction activity.
“The number of new homes built in England has picked up, but is not sufficient to keep up with the expected increase in the population.
“Looking forward, house price prospects will depend crucially on developments in the wider economy, around which there is a larger degree of uncertainty than usual.”
Hometrack has predicted an average growth of around for percent over 2017 with some higher than average increases for major cities like Manchester and their surrounding areas.
Richard Donnell, the insight director for Hometrack has said that 'In larger regional UK cities, such as Birmingham and Manchester, affordability remains attractive and we believe there is room for further price growth over 2017'.
He continued to say that: “With this in mind, we predict that city level house price growth in 2017 will run slightly higher than the current consensus of two to three per cent, however this will largely be driven by the scale of the slowdown in London.”
Stephen Smith, the director at Legal & General Housing Partnerships has stated how the forecast that has been created by Royal Institute of Chartered Surveyors paints a more positive picture about the future of Britain's housing market.
“This is particularly true when compared to predictions by some of the bigger institutions in the aftermath of the Brexit vote,” he said.
“Despite speculation about the referendum result causing a fall in house prices, it is encouraging to see that many surveyors are challenging this by forecasting that house prices are set to increase by three per cent in 2017.”
This is not a negative at all, according to Mr Smith, saying that 'this would be welcome news considering that fluctuations in property prices can be a double edged sword' and 'lthough rampant house price inflation pushes many first time buyers out of the market, a fall in house prices can be equally destabilising for families and their finances across the UK'.
In terms of what would be most ideal for residents of the North West, he suggested that an ideal market would mean the house prices would rise slowly and slightly below the national wage growth. This, in term, would allow the market to return back to the equilibrium that is ideal for everyone. It would mean existing homeowners would be more confident that their property is indeed appreciating in value and first time buyers are actually able to save up enough to be able to afford their first home.
2017 is sure to contain a twisting wheel of emotions when it comes to property searching in the North West. Experts are divided on if this will be a positive or negative year for homeowners but there will certainly be some interesting results to observe over 2017.