Housing Growth?

A poll of analysts conducted by Reuters, suggests that house prices will rise on average 2% in 2017. There is a number of factors to consider beneath this headline.  Firstly, although positive, if we see 4% inflation next year, this will mean a real terms fall in value of 2%. Secondly, London as a whole will likely see a fall in value in any event (0.5%), having enjoyed spectacular growth over the past five years.  Thirdly, average figures have a habit of massively underestimating the potential growth in areas of structural local market changes, such as major regeneration initiatives. For investors, a tighter approach to stock selection will be key. For first time buyers, still presented with favourable borrowing rates, finding the deposit remains the central challenge.