Busy New Year start for residential property investors

on Jan 20, 2015

A reduction in the rate of increase of housing prices over the last 6 months of 2014, along with a slowing of sales activity in general, indicate that the recent jump in January house prices could be linked to the new Stamp Duty reform, which many potential buyers could have been waiting to take advantage of in the New Year.

According to new statistics from Rightmove.co.uk, the current upward spike in house prices this month, a month that usually shows a price decrease, may also result in increased pressure being exerted on house buyers due to a shortfall in supply as New Year house hunters begin to enter the market.
Miles Shipside, Rightmove director and housing market analyst cautioned that while early statistical evidence for 2015 illustrates the potential of a favourable market for those looking to purchase, it may be too early to say definitively that this will remain the case as the year progresses.

“There are more positive signs of early-bird activity rather than pre-election jitters or economic worries deterring prospective movers. However, we are only a few days into the year and it remains to be seen whether this initial flurry is sustained.”
Furthermore, with a 10% decrease in housing stock on the market, as compared to the same period in 2014, a continuing upward trend in prices for the first few months of 2015 may be likely as more buyers seek to close sales early on in 2015. Shipside notes that:

“The unseasonably high 1.4% jump in new sellers’ asking prices suggests that there are more rises in the pipeline for the next few months.
Despite the outlook being one of increased prices and activity, the upcoming general election could still see some decrease in the amount of activity in the housing market during the build-up to the election, especially if any of the major contenders include resolutions related to the property market in their election manifestos.

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