Industry experts’ property market predictions for 2014 – Part 4

Posted 10 January 2014 by Keith Osborne

We asked some of the biggest names in housebuilding, investment and estate agency to answer a few questions about the property market in 2014: their predictions for its direction 2014, what's in store for first-time buyers in particular and what they would do if they were made Chancellor of the Exchequer for the day. Read on to find out what they said.

What do you think will happen in the UK residential property market in 2014?

Inessa Falina, head of property services at Ashton Rose: "Whilst many speculate one way or another on which way the market is going, our message is simple; we see London property as a fantastic long-term growth opportunity which is why it is now an accepted global asset class. Nevertheless we advise clients to consider these points to ensure that their property provides the perfect investment or home for their long-term needs."

Graham Davidson, managing director of Sequre Property Investment: "We are expecting a huge shift in focus from the South to northern cities, which benefit from higher yields and significantly cheaper prices. We continue to see growth in the number of new buy-to-let investors coming to the market having lost faith in the banks and stock markets."

Michael Wilson, director and head of sales at Mountgrange Heritage: "We are expecting price growth to be less energised throughout 2014, as we anticipate supply to loosen a little, as tax and planning policies tighten. While some Prime Central prices may increase at a slower rate, our North Kensington and Bayswater offices saw tremendous prices rises in 2013 which I expect to continue. The success of the prime markets in 2013 has caused a ripple effect in Kensal Rise and Queens Park, and even as far out as Harlesden. In these areas vendors are already selling properties at ‘next year's prices', sometimes 5-10% ahead of guide price."

Mark Wright, managing director of David Wilson Homes: "Predictions are always difficult but what I would like to see in 2014 is the foundations of long-term sustainable recovery in the housing market."

Dave Sheridan, CEO of Keepmoat: "Housing was huge news in 2013. We need to capitalise on this to push for more genuinely affordable houses to be built in Britain. Ahead of the 2015 election we expect political parties to promise to build more and more homes so more families can get on the housing ladder."

Dick Mortimer, group director of property services at Family Mosaic: "The UK residential market in our areas of operation, especially London and the South East, will remain ‘bullish'. Some of this is fuelled through overseas investment but much is fuelled by an enormous shortfall of housing - especially in London. The longer-term worry is interest rate movement which could push people into financial difficulties if interest rates move over the coming months."

Will the planned increase in housebuilding, along with better mortgage choice, give first-time buyers (FTBs) more hope in 2014 than in 2013?

Guy Gusterson, managing director of St. Modwen Homes: "House buyers are aware that we now operate in a much more regulated market than the interest-only mortgage rates offered pre-2008, and expect to need a minimum 5% deposit when buying a home. This can only be a good thing, as it encourages sound financial planning and prevents purchases on a whim, making for sustainable homeownership. With more mortgage lenders now offering different products and rates which allow people to purchase a new home with a 5% deposit, FTBs should find that there is more choice open to them."

Kevin Hollinrake, managing director of Hunters Property Group: "Now also available for second-hand homes, [Help to Buy] will continue to encourage lenders to open their coffers to new borrowers who have a good credit track record and are very likely to maintain payments, even when interest rates start to rise. More buyers will mean more sellers of both new and second-hand homes which can only be good for aspiring FTBs."

Alistair Brown, director at Tylers Property Partnership: "Increased supply can only be a good thing for those on the demand side of the equation, increased confidence by lenders and increased job security should also assist in this key market."

Alan Brown, chief executive of CALA Homes: "Yes. An increase in the number of new developments being granted planning permission will increase the availability of suitable homes for FTBs and this, together with government schemes such as Help to Buy, should significantly help those looking to get on the property ladder in 2014."

If you were Chancellor for the day and could implement one change to the property market in 2014, what would it be?

Anne Cadman, regional sales director for Bloor Homes Midlands: "If I were to be Chancellor for the day, I would increase the 1% Stamp Duty threshold to £175,000, to help FTBs, increase the 3% Stamp Duty threshold to £300,000 to help growing families. Also, I would raise the 4% threshold to £750,000 to help the higher end of the market. Even if this was only for a limited period, every section of the market would benefit, which would give a huge boost to residential property market."

Nicholas Spencer, sales negotiator at Henry & James: "Flip Stamp Duty Land Tax (SDLT) from buyer to seller: the seller has just sold for a handsome profit and can afford it better. The buyer is likely at full stretch. The buyer will actually continue to pay of course, but it will be bundled up into the purchase price, via the mortgage, so spreading the payment monthly. It would ease the burden of moving, raising the number of transactions and raising the tax take. If the vendor pays the SDLT, then it is always paid by the one who can afford it most and in a chain. It is always the lower rate being paid."

Tony Dowse, chairman of eco-housebuilder Environ Communities: "A national bank to fund smaller businesses and entrepreneurs. We have plenty of schemes that could be built if funding was available."

Chris Endsor, chief executive of Miller Homes: "Ensure that the public land disposal programme is fast-tracked and that all local authorities diligently maintain a five-year housing land supply and deliver timely planning permissions that are viable and free from onerous conditions."

John Tutte, group managing director for Redrow Homes: "I would reform Stamp Duty. The current ‘slab' approach creates artificial pricing. Even a modestly priced home attracts a high level of tax. Can it be right that a first-time buyer in some parts of the country has to find 3% of the purchase price for tax having saved hard to raise a 5% deposit?"



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