THE managing director of Romans estate agents has made a few predictions about the property market.
Peter Coles said: “I’m not predicting a property bubble – allowing for inflation, prices in the South East are still 10-20 per cent below where they were in 2007, and because interest rates are so low the key driver, affordability, is still below the long-term average levels, from the last 30 years.
“This means that even if rates increase a little over the next few years this would not cause a problem.
“Most people are predicting that house prices will increase throughout 2014 but I anticipate that the most significant increases will be in one and two bedroom properties.
“This will be due to increased demand from first time buyers, aided by the Help to Buy schemes and Buy to Let investors.
“This is positive news for ‘second-steppers,’ as the demand for their properties will make it easier for them to move up the housing ladder.
“Landlords and investors will also see a great return with significant capital growth on top of already strong rental yields “The rest of the market will see increases of anything from naught to 10 per cent with well-presented properties in good locations seeing stronger increases and selling quickly.
“It’s also worth noting that transaction numbers and prices at the top of the market have been impacted by the punitive increases in Stamp Duty Land Tax in recent years and I foresee this continuing.
“This is no surprise when you consider that it would cost the equivalent of over £130,000 of salary before tax to pay the Stamp Duty Land Tax bill on a £1.5m purchase price.”