Predictions from the Royal Institution of Chartered Surveyors (RICS) suggest that house price growth will slow by more than half in 2017 – whereas rents will rise by as much as three per cent.
The RICS has said that it expects the current pace of average house price growth of 6.5 per cent to fall to just three per cent next year.
It says that high demand for a weak supply of new homes will help to maintain momentum in price growth – albeit it a much slower rate.
The RICS report also suggests that there will be weaker demand from buy-to-let investors in the New Year following unpopular Stamp Duty Land Tax (SDLT) changes, yet it predicts that rent costs will grow by three per cent over the next 12 months.
It also said that first-time buyers are likely to continue to struggle to get on the property ladder.
RICS Chief Economist, Simon Rubinsohn, said: “Although recent announcements by the Government on housing are very welcome, the ongoing shortfall of stock across much of the sales and lettings markets is set to continue to underpin prices and rents.
“As a result, the affordability challenge will remain very much to the fore for many”.
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