House prices 2015: growth 'will slow to 4%'
01-07-2015
Despite a rise in first time buyers, experts say growth in house prices will continue to slow during 2015
The number of first-time property buyers in the UK has risen to its highest level in seven years, according to new research from one of Britain's biggest lenders, but overall growth in the housing market will be lower in 2015 than it was last year, experts predict.
Halifax said that the number of buyers entering the housing market increased by 22 per cent to 326,500 last year, just short of the 23 per cent increase in 2013.
Government schemes such as Help to Buy, better job prospects and cheap mortgage rates have all contributed to the increase, the BBC says.
Halifax's mortgages director, Craig McKinlay, said: "First-time buyers are vital for a properly functioning housing market. Improving economic conditions and rising employment levels have boosted confidence among those thinking about getting on to the housing ladder for the first time, contributing to the significant increase in the number of first-time buyers in the past two years."
But the news comes amid predictions of slower growth across the property market in 2015, with the BBC noting that many experts anticipate growth of just four per cent this year, compared with 7.2 per cent in 2014.
The looming general election will be the major factor affecting activity in the housing market in the early part of 2015, explained Ray Boulger from mortgage brokers John Charcol. Growth is unlikely to pick up until the results are known, he added.
The outcome of the election could have a huge impact on the market, says Nicole Blackmore in the Daily Telegraph, as "many buyers at the higher end of the market will be concerned about Labour’s proposed 'mansion tax', which will apply to all homes worth more than £2m".
This "nervousness" among high-value property buyers, particularly in London, will serve to restrict house price growth not just in the capital but across the UK, housing expert Henry Pryor told the BBC.
Of course, forecasting property prices "isn't an exact science", notes BT.com. In a rundown of the predictions of leading experts over the past eight years, the site found that many were extremely inaccurate, with some forecasters' calculations out by as much as ten per cent. "Given their track record, it will be interesting to see wherever any of them get close." ·