So with 2014 having come to a close, what does the market this year tell us about investment opportunities, and is now the best time to buy or sell homes in the UK?
According to the latest figures published at the end of the year by LSL Property Services, the average price of houses across the country climbed by some 11.3 per cent in 2014. While previous years had been strong for the property market, this is actually the best year in terms of price growth since 2005.
The decade high means that the average property price is at more than £280,000 for the first time in history. London property has been the real booster behind this as well, with homes in the capital having seen increases nearing 20 per cent in terms of price in the last year.
Without London included, the average property price rise in the UK falls considerably to just 5.7 per cent. With the capital's property market as healthy as it is at the moment, is it time to buy, or should investors be looking to sell their properties?
Is now the time to sell a house?
Whenever property prices hit a peak, sellers are excited because it gives them the chance to get their home on the market and make a profit on what they paid for any home. This is true at the moment, with property prices having hit £280,000 on average nationwide for the first time.
Price rises are faster than they have been at any time in the past few years, which means that sellers can get themselves involved in a red hot property sales market, where they are likely to be able to capitalise on strong demand to make good capital gains.
In addition to this, sellers are currently looking at a boom period ahead of a predicted slowing in demand, particularly in London. While prices for 2015 are expected to grow between two and three per cent overall, the first half of the year is likely to see a much lower level of demand than that which is currently in evidence.
With a great deal of uncertainty surrounding the upcoming general election, home buyers are expected to be in short supply for the first half of 2015, which could mean that now is the time to sell to capitalise on demand before it falls away, but could also represent a time to wait and see what happens throughout the rest of the year. A sharp rise in demand following the general election could be fantastic news for sellers, which means that waiting for now may well be best practice.
Is now the time to buy a house?
It may not seem to be the ideal time to be a buyer when prices are at their all-time peak - after all, who wants to buy when prices are higher than they've ever been. However, the market conditions across the UK at the current time are such that buying a property could still be good news at the moment.
For one thing, property prices are only set to increase further throughout the next couple of years. In spite of a slower first six months of the year, Savills predicts strength moving forward and said that property prices should climb by more than two per cent in 2015.
Looking further ahead, predictions are that 2016 will see the market continue to get stronger, and growth should take prices to more than ten per cent higher than where they currently are, giving buyers the chance to buy now and be ahead of the curve in terms of even greater price rises.
Stamp duty has to also be taken into account, and after the chancellor announced recently that the way it is calculated would be changed, it is thought that 98 per cent of buyers will pay up to £2,500 less than under the old system. This will mean a stronger demand and higher prices in the next few years. Not only do people buying now see themselves able to get onto the ladder for a price that's only likely to get higher, they also see strong prospects for capital growth in the future.