Property Market Predictions for 2016
Property Market Predictions for 2016. There seems to be a change in trends for the property market in 2016 as predicted by experts. The overall asking prices of property for sales in the UK are going to increase by at least 10% and there seems to be a greater demand for homes for sale than it was last year despite the increase in the prices of both residential and commercial properties. However, despite the increase in asking prices, there seems to be a fairly constant rate for properties across the nation for the greater part of this year although there might be a slight rise in rates by the end of the year.
One of the most important factors that decide the property trend is the interest rate set this year by banks offering home mortgages. If the interest rates are increased, the rates of the mortgages will also increase, allowing more people to receive mortgages from banks to purchase their own property. If the interest rates increase, the prices of property will increase but the demand for residential property purely depends on the allowance of home mortgage, which seems to balance the trends.
With the new Stamp Duty on buy-to-let and second homes supposedly taking effect from April, it is predicted that there is going to be a sudden increase in residential properties in the market as smaller landlords and people who own multiple properties are most likely going to sell their properties to avoid paying extra as a result of the SDLT. However, as the prices of properties are going to increase, there is a chance that there will be lesser people opting to purchase them unless they are bought by larger landlords who can afford to pay the stamp duty. We are certainly seeing a rush of buyers trying to beat the new rise, what will happen after the rise happens will remain to be seen.
This is alarming as there are chances of lots of properties available for sale in the property market without enough people having enough money to afford them. For the residential rental market, the rents are likely to rise, and the demand for rental property is going to increase because of so many rental properties going off the market.
A general demand that has been increasing in the last 5 years is the demand for small rental spaces in commercial areas so workers can live closer to their work place. The demand for one-units and apartments in the cities like London are high, but the rates of property in big cities are too high, and so most people prefer living on rent or buying property in the countryside nearby the cities so they can travel to the cities they work in.
The increase in the prices of property is thrice as much as the increase in average wages, and this might be the reason why people are now moving out of London to other cities like Nottingham, Leeds, Liverpool, Manchester, Edinburgh and Cardiff as the prices of property are more affordable there.
In conclusion, 2016 will most likely see a rise in the prices of property, but how much the buyers demand the property and their willingness to purchase the properties in the market is yet to be determined as it depends on several factors.
For now, it seems that the beginning of the year is going to be a very important time as it is going to clear up the trends in the market for the rest of the year.
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