House sales to fall 11% next year predicts agency

Transaction levels are forecast to decline from around 1.22m this year to 1.08m next year as uncertainty causes some households to defer house purchase decisions.

JLL says this is down to uncertainty caused by Britain’s exit from the EU, and from the ongoing effects of different stamp duty reforms from late 2014 until April this year.

The company says 2018 will be characterised by more certainty in the market as there will be greater evidence of how the EU negotiations are progressing.

JLL expects prices to be broadly unspectacular, rising 0.5 per cent on average in the UK next year; prices will rise 1.0 per cent in 2018 and 2.0 per cent in 2019. The increase in 2020 will be 4.0 per cent.

An exception to this all-UK average will be prime central London. This will see prices stagnate next year although by 2020 it should see a 5.5 per cent annual increase.

The Brexit vote also lies behind what JLL predicts will be a fall back in new house building figures.

“Although levels of new housing delivery were still woefully low prior to the referendum at least the direction of travel was positive and encouraging. This will now fall back again” warns JLL research chief Neil Chegwidden.

He says the 146,000 units delivered in 2015 would drop to 134,000 next year, with the slowdown most acute in London, and that this shortfall in housing supply will help bolster prices of remaining properties on sale.

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Written by: Houseladder