Confidence in the UK housing market is now at a three-year low, according to the Halifax building society's monthly survey.
This is the time of year when property experts scratch their heads and try very hard to forecast what will happen in the next 12 months.
But JLL and Savills, two of the UK's leading property consultancies, have highlighted the difficulty of looking forward at this point in time.
Adam Challis, the head of UK residential research at property consultancy JLL, summarised his forecasts with the title Uncharted Territory. Recalling the maps that the early explorers were aiming to fill in, he pointed out that the unknown was usually marked "Here Be Dragons".
For the record, JLL is expecting GDP to slow to 1.2 per cent in 2017, down from 3.5 per cent in 2014.
It does not see it pick up again until post-Brexit 2020, when it has pencilled in 2.3 per cent growth.
On average UK house prices, JLL sees just 0.5 per cent growth in 2017, down from the estimated 7 per cent growth of this year. Prices will stay subdued for the next two to three years, before beginning to rise more strongly in 2020, it says.
JLL believes Brexit uncertainty will continue to be the overriding characteristic of 2017.
Lower consumer confidence, lower investment from business and a small rise in unemployment are all expected to dampen GDP growth.
Savills also says Brexit makes the job of forecasting more perilous. It sees no growth in house prices next year and a fall in values in prime central London. It expects a slight uptick in growth (to 2.2 per cent) in 2018, with a pick up of 5.5 per cent growth in 2019.
Over five years it expects to see London house prices grow by 11 per cent, considerably outperformed by the east and south-east of England where growth will be 19 per cent and 17 per cent, respectively, it says.
"A realisation that Brexit feeds into the wider economy, people's prospects for earnings, people's prospects for employment and then that beginning to filter through into the hard economic reality ... is likely to make buyers more cautious," Lucian Cook, the director of residential research at Savills, tells The National.
Increases in the stamp duty property tax on the most expensive homes have also hit demand, especially in central London, where some buyers have negotiated price cuts or delayed purchases. Savills does not forecast a return to current levels of growth until at least 2022, with price rises cooling again at the start of the decade due to an expected increase in interest rates from 0.25 per cent, which would push up borrowing costs.
But the UK's housing problems are not just to do with the economy stagnating in the face of political uncertainty and Brexit headwinds. Supply has been constrained for many years and has not yet recovered to the 184,000 housing starts seen in 2007, the year before the start of the financial crisis. The most recent estimate of the country's housing need came from the House of Lords economic affairs committee, which reckoned 300,000 homes a year are required.
The prime minister Theresa May has suggested she will take an interventionist approach, therefore adding to the upheaval in a market that lurches from one new initiative to another.
The mayor of London, Sadiq Khan, has also pledged to investigate foreign ownership of property in the capital, claiming it is one of the factors that causes rising house prices and means Londoners cannot afford to buy in the city where they live.
Mr Challis says such investment is necessary. "There are too many myths about the negative impacts and not enough voices arguing for the important role that investment capital plays to underwrite development activity to deliver both private and affordable homes," he says.
He contends that, far from restricting supply to the city's population, overseas buyers provide a supply of properties to rent. He suggests that 85 to 90 per cent of Asian buyers in London plan to rent out their property, and many buy for their children who are attending university in the UK. The number of vacant homes has also declined consistently in the past 11 years, and was at 203,596 in 2015, down 36 per cent since 2004.
Yolande Barnes, the director of Savills world research department, estimates that 7 per cent of property in London is owned by foreign buyers, with more in high-end locations in the centre of the city.
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