Growth in UK house prices will grind to a halt next year, a closely-watched forecast has suggested, with the number of homes bought and sold falling to their lowest since 2013.
Predictions by the Royal Institution of Chartered Surveyors (RICS) indicated housing transactions were unlikely to rise above 1.2m in 2018
That will be the first time since 2013 it misses that figure: the latest data from HM Revenue and Customs indicates transactions hit 1.22m in the 12 months to October this year, while in 2016 transactions were at 1.23m.
RICS said the main driver of the fall in transactions will be a lack of supply, after the stock on estate agents' books fell to an "all-time low" this year.
"There are no signs as yet that 2018 will see a turnaround in supply across the second hand market," it said.
Meanwhile, house price growth will flatten out as it continues to be hit by tax changes and interest rate rises.
However, the organisation added changes to stamp duty may provide "some upside" to first-time buyers, helping to make homes more affordable.
"With several of the forces currently weighing on activity set to persist over the near term, it’s difficult to envisage a material step-up in impetus during the next 12 months," said Tarrant Parsons, economist at RICS.
However, the fundamentals are not much changed from the end of 2017, so levels of activity should soften only marginally when compared to the year just ending. A real lack of stock coming onto the market remains one of the biggest challenges, while affordability constraints are increasingly curbing demand in some parts. Given these dynamics, price growth may fade to produce a virtually flat outturn for 2018.”