UK home prices to build on recent gains but supply an issue
cpurl://apps.cp./cms/?pageId=house-poll poll data
By Jonathan Cable
LONDON, May 29 (Reuters) -British home prices will rise modestly this year and increase faster than overall inflation in the next two years, according to housing market specialists polled by Reuters, supported by expected reductions in borrowing costs and a dearth of supply.
The 1.8% increase predicted for 2024 will be outpaced by wage growth. Coupled with an expected fall in mortgage rates, all 19 respondents to an extra question said purchasing affordability for first-time buyers would improve over the coming year.
"Stable house prices combined with real income growth should aid affordability this year," said Aneisha Beveridge, head of research at estate agency Hamptons.
While prospective buyers may be better able to finance a purchase, supply remains a problem, especially for entry-level homes.
All 17 specialists answering another question said the supply of affordable homes would fall short of demand over the coming two to three years, including 11 who predicted it would be far short.
"Construction is throttled by a lack of positive sentiment among developers. They will only build again when there are sure signs of market and political stability," said property consultant Russell Quirk.
Earlier this year, major housebuilders cut their building targets. Persimmon PSN.L last month said it was confident for the rest of 2024, while Taylor Wimpey TW.L posted an improvement in its sales rate but both left their building targets unchanged.
The government should get more involved in improving affordability, according to 13 of 16 respondents to an extra question.
Reducing housing taxes, encouraging office conversions, loosening planning restrictions and expanding shared equity initiatives were some of the ideas mooted.
Prime Minister Rishi Sunak last week called a national election for July 4 and is lagging Keir Starmer's Labour Party in polls.
Neither party has yet published their manifestos and some regular contributors declined to participate in the Reuters poll this quarter.
"With little consensus about how to best resolve the housing crisis, it is likely that, even under a new Labour government, the gap between supply and demand will continue to widen for the foreseeable future," said David Rees at estate agency Chestertons.
After rising 1.8% this year, home prices will increase 3.1% next year and 4.0% in 2026, median forecasts in the May 9-29 poll of 22 specialists showed. 2024 forecasts ranged from a 4.0% drop to a 4.0% increase.
In a February poll, the respective annual forecasts were for no change, 3.0% and 4.0%.
That is a long way short of the pandemic boom time when home prices soared 25% between February 2020 and September 2022 as buyers searched out more space and took advantage of record low interest rates.
"Reflecting the sluggish economic outlook, projections for house prices over the next three years are similarly subdued, although deeper interest rate cuts or tax incentives could quickly change this," Chestertons' Rees added.
Bank Rate, currently 5.25%, will be 4.50% at the end of this year and 3.50% at end-2025, a separate Reuters poll found, still a far cry from the record low 0.1% during the pandemic era.
In London, a magnet for foreign investors, prices were expected to rise 1.8% this year, 3.9% next and 4.9% in 2026 - an increase from February's survey.
(Other stories from the Reuters quarterly housing market polls: nL4N3HK2FK)
Reporting by Jonathan Cable; Polling by Anitta Sunil and Sarupya Ganguly; Editing by Sriraj Kalluvila
Mga Kaugnay na Asset
Pinakabagong Balita
Disclaimer: Ang mga kabilang sa XM Group ay nagbibigay lang ng serbisyo sa pagpapatupad at pag-access sa aming Online Trading Facility, kung saan pinapahintulutan nito ang pagtingin at/o paggamit sa nilalaman na makikita sa website o sa pamamagitan nito, at walang layuning palitan o palawigin ito, at hindi din ito papalitan o papalawigin. Ang naturang pag-access at paggamit ay palaging alinsunod sa: (i) Mga Tuntunin at Kundisyon; (ii) Mga Babala sa Risk; at (iii) Kabuuang Disclaimer. Kaya naman ang naturang nilalaman ay ituturing na pangkalahatang impormasyon lamang. Mangyaring isaalang-alang na ang mga nilalaman ng aming Online Trading Facility ay hindi paglikom, o alok, para magsagawa ng anumang transaksyon sa mga pinansyal na market. Ang pag-trade sa alinmang pinansyal na market ay nagtataglay ng mataas na lebel ng risk sa iyong kapital.
Lahat ng materyales na nakalathala sa aming Online Trading Facility ay nakalaan para sa layuning edukasyonal/pang-impormasyon lamang at hindi naglalaman – at hindi dapat ituring bilang naglalaman – ng payo at rekomendasyon na pangpinansyal, tungkol sa buwis sa pag-i-invest, o pang-trade, o tala ng aming presyo sa pag-trade, o alok para sa, o paglikom ng, transaksyon sa alinmang pinansyal na instrument o hindi ginustong pinansyal na promosyon.
Sa anumang nilalaman na galing sa ikatlong partido, pati na ang mga nilalaman na inihanda ng XM, ang mga naturang opinyon, balita, pananaliksik, pag-analisa, presyo, ibang impormasyon o link sa ibang mga site na makikita sa website na ito ay ibibigay tulad ng nandoon, bilang pangkalahatang komentaryo sa market at hindi ito nagtataglay ng payo sa pag-i-invest. Kung ang alinmang nilalaman nito ay itinuring bilang pananaliksik sa pag-i-invest, kailangan mong isaalang-alang at tanggapin na hindi ito inilaan at inihanda alinsunod sa mga legal na pangangailangan na idinisenyo para maisulong ang pagsasarili ng pananaliksik sa pag-i-invest, at dahil dito ituturing ito na komunikasyon sa marketing sa ilalim ng mga kaugnay na batas at regulasyon. Mangyaring siguruhin na nabasa at naintindihan mo ang aming Notipikasyon sa Hindi Independyenteng Pananaliksik sa Pag-i-invest at Babala sa Risk na may kinalaman sa impormasyong nakalagay sa itaas, na maa-access dito.
