House Prices14 Apr 2015 09:49
Latest forecasts from the Centre for Economics and Business Research (Cebr) predict that average UK house prices will rise by 1.5% in 2015, an upward revision from January's forecast where the research body expected a 0.6% decline in prices. This reversal is largely due to stamp duty changes having a sooner-than-expected impact, it said in the report, while an improving labour market has boosted consumer spending power. Expectations have been revised up for nearly all regions in the UK, with London being the most notable exception - prices in the capital are expected to underperform those in the rest of the country, with a decline of 3.6% predicted for the year. Indicators such as fewer new buyer enquiries and longer selling times already point to falling prices. House price growth is expected to be stronger outside the capital than within it for the first time since 2009, as the decline in overseas investment (led by factors such as mansion tax concerns and the strength of sterling) will have minimal impact elsewhere in the country. "Outside of London, the outlook for house prices this year has improved after a few months when the market appeared to be coming off the boil," said Nina Skero, Cebr economist and main author of the report. "December's stamp duty changes, as well as rising household incomes, are lifting prices in many parts of the UK. In London, however, we expect prices to decline by 3.6%, driven by a significant weakening at the prime end of the market."