Contact our offices
5 & 6 BAILEY COURT
COLBURN BUSINESS PARK
Estate Agency Offices are located in
BARNARD CASTLE, LEYBURN, STOKESLEY & BOROUGHBRIDGE
Residential Management Team
As agents, just what are we expecting in the sales and rental sector in 2016?
From a sales perspective it is encouraging that there has been an upturn in new sales listings in the UK property market, for only the third time in the last 18 months. This will hopefully help to reduce the pressure on supply, which has seen a marked 22% reduction in listings across all estate agency branches nationally compared with a year ago. (RICS January 2016; UK Residential Market Survey).
Alongside this, we have seen a steady increase in new buyer interest with the pace of growth accelerating for the second month in a row. The RICS have advised that this demand has been bolstered by a rush of buy-to-let investors looking to complete on transactions before the 3% stamp duty surcharge comes in to effect in April. The rental sector is facing additional pressure within the investment market (given that mortgage interest relief will be reduced to only the basic rate of income tax by 2017) which may result, in time, in landlords exiting the buy-to-let sector. At this time, it is too soon to read into this accurately, but no doubt this will be closely monitored by the experts over the next year to 18 months.
The general consensus is that, within the rental sector, all areas are seeing a steady rise in interest. Landlord instructions are largely flat, which points to rental growth within the rental markets over the next 12 months. It will be an interesting time as demand continues to outweigh supply. Savills recently reported (Rental Britain Here to Stay February 2016) that the demand for rental properties is still rising. This underlines the long term trend, which predates the financial crash of 2007.
In plain terms, this remarkable growth equates to 17,500 households in England per month, on average, over the 10 years to 2014. The general con-census is that house price inflation has precipitated this growth, which has generally supressed wage growth. The Governments three pronged approach to snuffing out increasing house price inflation, which includes; affordable housing, shared ownership homes and help to buy scheme, has somewhat counteracted this rise in rental growth. Government policy is targeting 400,000 affordable homes to be built, which will enable an average 80,000 new households a year to access home ownership over the next 5 years.
Quite how this will manifest itself on the ground over the coming year will be interesting to report and once the analysis has been done, I am sure we will have further comment to make. Our market town offices vary massively in terms of activity between property types at any one time and it will be interesting to analyse the progression of the market in late winter this year and on into early Spring 2017.
[team-member name=”Chris Arundel”]