House prices will fall an average of 0.5 per cent across Yorkshire in 2017 according to data from the Countryside estate agency network.
However, Yorkshire will fare better than many other parts of the country and can also expect to see a housing market recovery in 2018.
According to Countrywide, the principal cause of the wobble on house prices is not the prospect of Brexit itself but the uncertainty over the economy the referendum vote has triggered.
Fionnuala Earley, Countrywide’s chief economist, said: “Forecasts in the current environment are trickier than ever as the vote to leave the EU has thrown up many risks.
“Our central view is that the economy will avoid a hard landing, which is good news for housing markets.
“However, the weaker prospects for confidence, household incomes and the labour market mean that we do expect some modest falls in house prices before they return to positive growth towards the end of 2017 and into 2018.
“Not all of the corrections are due to the vote to leave the EU. Stamp duty and weaker house price growth expectations, particularly in London’s prime markets, have a part to play.
“There are supports to prices on the supply side from the continuing mismatch of supply.
“On the demand side, ultra-low interest rates and the significant discounts available to overseas buyers resulting from the fall in Sterling will help to support prices too.”
According to today’s forecasts, house price growth in Yorkshire is expected to slow to one per cent this year compared to the 4.5 per cent increase seen last year.
The slowdown is forecast to turn into a price fall of 0.5 per cent next year before rallying back into growth of two per cent in 2018.
Nationally, house prices are expected to dip by a full percentage point in 2017 before growing by two percentage points the following year.
London will see the biggest fall next year at 1.25 per cent with the South East and East also seeing one per cent falls.
The report says: “While London and South Eastern markets are expected to see the largest slowdown in prices, the North and Midlands will not be unaffected.
“Affordability pressures are less severe in these markets, but economic conditions are weaker with lower pay and higher unemployment rates than the UK average.
“The concentration of manufacturing also leaves parts of the North and the Midlands in particular, exposed to uncertainty about export tariffs and inward investment, despite the support of a weaker currency.”
The referendum vote to leave the European Union has triggered serious warnings about the short term prospect for the UK economy.
The Bank of England has forecast 250,000 jobs will be lost by the end of 2018 even allowing for attempts to stimulate the economy while output will be 2.5 per cent less than previously expected.
The falling value of Sterling is also expected to see inflation rise to 2.4 per cent.
Earlier this month the Bank’s Monetary Policy Committee cut its base rate to a record low of 0.25 per cent.