2017 was an interesting year for the property market.

Prices were ignited by the Governments revisions to Stamp Duty Land Tax which coincidently came into effect just before the General Election and on the back of last year?s ? help to buy? scheme.

The impact of ?help to buy? in 2014 gave rise to a 10% increase in prices and the feel good factor of the lower rates of Stamp Duty for the majority of buyers gave impetus to a second surge in prices of 10% this year and in some instances by a staggering 20%, well beyond most ?experts? predictions in 2014 and well ahead of Nationwide Building Society?s analysis released at the end of November 2015 that UK prices rose on average by just 3.9%.

Demand has once again outstripped supply for all style of properties and price ranges. First time buyers were in greater abundance this year and were particularly aggressive in their bidding with a large number of sales being agreed considerably over the asking price.

Lenders have been actively competing for business with lots of attractive mortgage deals on offer.

Speculation over interest rates continued throughout the year. The near zero rate of inflation in the economy blocked an increase in UK interest rates for the time being .

The U S Federal Reserve have been hinting at an increase in interest rates for the past 18 months and at long last the move was made on the 16^th of December by 0.25%. The amount of the increase is not important. It should be viewed as a landmark event, a statement of confidence that the US economy is now officially in a state of recovery. To quote Winstone Churchill ?Now this is not the end. It is not even the beginning of the end. But it is, perhaps, the end of the beginning?. The best guess is that the Bank Of England will follow suit in the second half of 2016.

The biggest question for 2016 relates to the likely effect on the property market of the additional 3% Stamp Duty applied to second home buyers and investment landlords due in April 2016.

Strange that the Government are hitting the very people who kept the property market alive when lenders had for years blocked out first time buyers for the best part of 5 years with the requirement of a 20% to 25% deposit.

Previous to the Governments renewed love affair with first time buyers, it should be remembered that without investment buyers the property market would have collapsed in 2008 and for much of the following six years.

Sadly the Chancellor George Osbourne and the Governer of the Bank of England Mark Carney have their daggers drawn against investment buyers. This is politics in action.

To deliberately exclude a section of buyers from the market place is extremely dangerous when IF MORE PROPERTIES WERE BUILT there would be room for first time buyers and rental investors.

The double effect of the Governments Help to Buy and Stamp Duty revisions are the cause of rising prices during the past two years not the activity of rental investors and the hobbling of investment buyers will in my opinion be extremely negative and potentially very dangerous for the future.

Buyers of property are happy to part with their money but apparently do not like paying tax. Properties previously selling at £250,000 are now selling for £300,000 with buyers prepared to spend an extra £50,000 in their purchase price happy in the knowledge that the bill for Stamp Duty has been reduced by £4,000.

Look at the high end of the property scale where the increased cost of Stamp Duty has had a hugely negative impact. The London Market in the £1.2 – £1.4 million price band has just about come to a standstill. It can be assumed that buyers in that price range are not particularly strapped for cash so this dramatic fall off has nothing to do with affordability just the revulsion against paying additional tax.