2013 house price projections: What the experts say

Monday, 14 January 2013

The coming year is set to be a challenging one for the UK property market, according to the latest industry projections.

Analysts and estate agents alike predict that buyers and sellers will face difficulty, but home insurance holders will have opportunities for profit and success along the way.

According to Grainne Gilmore, head of research at Knight Frank, the property industry is still feeling the delayed effects of the recession and this will continue to be the case in 2013.

"We expect a one per cent decline before growth returns," she said, adding that a recovery is on the cards, but nothing will happen immediately.

Other analysis suggests that some parts of the country, such as Scotland and the north of England, will see prices dip by up to four per cent before a correction takes place.

Though this may be considered bad news for anyone trying to sell their house, the Daily Telegraph's property expert Graham Norwood said that shrewd purchasers could snap up a New Year’s bargain.

"Once we are out of these particular woods, many predict a return to the sorts of increases Britain enjoyed before the financial crisis," he said.

His words were backed up by Tom Cann from BNP Paribas bank, who said he believes growth will accelerate beyond 2014, with house prices set to rise 8.8 per cent in 2015.

For those looking to profit, Mr Norwood recommends looking for "price pinch points” where stamp duty thresholds in effect force sellers to lower asking prices.

"Homes valued at just above £500,000, £1 million and £2 million are slow to sell. Buyers are reluctant to pay the four, five and seven per cent stamp duty that kicks in, and will hold out for a price below these trigger points," he explained.

Likewise, house-hunters should keep their eyes peeled for “micro-markets”, where infrastructure developments are set to make areas more desirable, the expert noted.

The third "golden rule" is to look for special reductions or giveaways, which often come on top of already low prices, while the final tip is to strike fast, as prices won’t stay low forever, and sellers will not remain on the back foot.

By staying alert and being prepared to take a chance, a major profit could be made in 2013 as the house market and prices fluctuate.

Posted by Noel Martin.

Copyright Adfero Ltd.

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