2015 is going to be an interesting year for the property market. We have seen a positive 2014 in terms of rising house prices and a reasonable amount of activity in the market. London has driven the way but towards the end of this year activity has cooled a little and there will be a further readjustment of pricing in the early part of this year.
If you look in the dictionary for the definition of "general election" I wouldn't be surprised if the words "a way to create a period of economic and personal uncertainty" jump out. History has shown that in years where there is a general election the political rhetoric can have a bearing on the mind of homeowners and lead them down a road of decision and indecision. Some will make that move and others will want to move but prefer to wait. There are always winners and losers with this strategy. The winners in 2015 are going to be the areas outside London. I predict that they will grow faster for the first time with the likes of Luton, Southampton and Brighton being hotspots.
Luton, for example, has fast become one of the most desirable places in the UK to live for those who want a great house, at a great price and yet they are only 23 minutes from London by fast train. The great houses and fast commuter trains are set to continue but finding great prices will over the next few years get harder and harder.
Overall sold prices in Luton over the last year were 5% up on the previous year and 4% up on the 2008 level of £170,706.
A ripple effect is occurring as cash-rich Londoners move out of the capital and buyers seek better value for their money and more affordable properties close to the capital. Prices have started to rise at rates greater than parts of London.
The majority of fastest performing areas are all within easy commuting distance of London, with Luton expected to see enormous growth of 41 per cent over the next few years. It leads the way with other commuter areas such as Brighton and Southampton mentioned earlier.
These areas will be great in the short term for first time buyers but in the longer term the rates of growth in house prices may have an impact on affordability. Sellers, buyers, investors and property developers could be big winners. Anyone buying now will see their price increase rapidly over the next few years and those selling now can ask a premium for the right property in the most sought after locations.
Ending on the election, the uncertainty around the outcome will have a bearing on the market but overall it will be a year of two halves. Whilst the first half of the year has always been the busiest period for the housing market I believe activity will flat line across the year with a little less in the first half but made up in the second. Whatever the outcome, sellers in the first half could be winners in the second.