CBRE is sticking by its forecasts, “despite” the outcome of the EU referendum.
In an update, the firm said it expects UK house prices to grow by an average of 3% this year, although southern areas are tipped to outperform their northern counterparts. Meanwhile, outer London and the surrounding home counties are expected to outdo central London.
Here’s the latest predictions:
The report adds: “Recent changes to stamp duty and the vote to leave the EU, together with the continuing decline in affordability, and a slump in consumer confidence, all remain downside risks to growth. Nevertheless, they have not, as yet, made a measurable impact beyond some anecdotal deceleration in growth and activity.”
It’s still a bit early to talk about long-term implications, cautions the firm, although there are a few reasons to be cheerful: the economy is fundamentally healthy, employment is high, borrowing costs are low, oil prices have fallen (UK is a net importer of oil) and the decline in the value of sterling will help stimulate exports.
The decline in interest rates is expected to prop up some house price growth and make borrowing more attractive to some purchasers in the short term, although buyer sentiment is likely to remain “cautious”.
Builder sentiment is more watchful still and the firm thinks many will adopt a “wait and see” attitude, exacerbated by the traditional summer slowdown.