Thursday, 28 December 2017

What’s the future for house prices in 2018?

The growth in house prices we’ve seen in 2017 “looks set to judder to a halt in 2018” according to a report in The Guardian.

Reporting the views of a number of experts, The Guardian says house prices are likely to rise by at most 1 per cent next year. And in London, they may actually fall.

Calculating house prices

It’s not all due to Brexit, apparently – rising interest rates are also expected to put a brake on housing price growth.

Whether you think this is bad news or good news depends on whether you already have a house or not, of course. If you’re saving to buy your first home some stability in the market is a good thing, allowing you to put money away for a deposit without finding that the rise in house prices is making your task more difficult all the time.

If you already own a house, rising house prices would mean that the value of your home would be going up. But so would the price of the house you may want to buy if you’re planning your next move. So you would be no better off, really!

If you own a house in London, and The Guardian is right when it predicts a small fall in house prices in the capital, console yourself with the thought that the price of your next home (if you are planning to buy in London) is also going down. And for first time buyers in London, a fall in house prices is all good news, of course.

Taking a long-term view, fluctuations in house prices next year are likely to have little impact. There have been short-term falls from time to time in the past decades but, over the years, house prices in the UK have always grown.

According to The Guardian, London house prices have risen by 70 per cent in the past ten years. Set against that background, a fall of a handful of per cent (if it happens) does not seem like a disaster.

Buying a house anywhere in the UK looks likely to remain a solid investment. And, more importantly perhaps, it means you have a home that you can call your own.

At Larkfleet Homes we're planning to build more homes in 2018 than ever before. So come and talk to us about your next move!

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