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Property Predictions 2019 – What the Experts Think

Posted 31 December 2018 by Helen Christie

We’ve listened to all the experts in the market, and we share their property predictions for 2019…

With 2019 just around the corner, there is plenty of uncertainty in the economy. What will happen after Brexit? Will property prices fall? And is 2019 a good time to sell your home? We have gathered some thoughts and predictions from many experts in the property industry...


Caroline Takla, managing partner of London buying agency, The Collection: “The first half of 2019 is likely to continue at the same rate as 2018, with the ever-increasing uncertainty holding back much of the market. Brexit and Corbyn are the two elephants in the room at present, however both of these should have been addressed by the middle of the year, clearing the path for the foreseeable future. By the end of Q2, bottlenecks will be resolved, paving the way for a steadier economy and a more attractive property market. Buyers and sellers who have been holding back for the past two years will be released, generating some much needed momentum.

"In terms of trends, the top end London market will continue to be strong next year. The view internationally is that Brexit will be cancelled and therefore many buyers have been continuing as though it simply isn’t happening. With the exception of Russian purchasers who have all but vanished from London, the weak pound is providing ample investment opportunities for overseas buyers. Dollar based buyers in particular are continuing to make the most of opportunities to bag a bargain, whether it be an unmodernised mansion or newly renovated apartment; as long as there is value to be found, they are transacting.

"For many families however, it is still business as usual. Those making the move to a larger property can take advantage of the current market, being able to stretch into that higher price bracket property that was out of reach two years ago. The expectation that prices will rise post-Brexit means now is a golden hour for deal-making. I see no reason why confidence won’t be restored next year. Once Brexit is over, the flood gates will open and the market will change completely.”


Nigel Howell, CEO, FirstPort Limited: “2019 will see a shift in focus for health and safety. In the wake of a tragedy, there is often a lasting effect on the way we do things. Grenfell Tower has brought the subject of health and safety front and centre. The Hackitt Review will provide the basis of building safety focus for 2019, but we must go beyond that. This is not a tick box exercise, changes need to be embedded in the culture of the property sector. For example, we know the relationships between Property Managers and resident customers need to change. More than ever before, Property Managers must provide a point of connection between those who develop buildings and those who occupy them, and Property Managers will have a role ‘behind the front door’. This won’t be without its challenges and sensitivities, but together we must find the right balance."


Sarah McIntyre, lettings director at Harrods Estates: “At Harrods Estates we have seen a marked increase in demand for lettings in Prime Central London in the last 12 months with the majority of tenants coming from the Middle East (approx. 85%) with the remaining 15% coming from the Far East, Asia, Russia and Europe. In particular, our Knightsbridge office has seen a 47% rise in transactions and an increase in the number of high value short lets, particularly in the summer months as many wealthy individuals like to visit London and spend time here during this period. Other tenants include business professionals and wealthy students.”

  

Shaun Drummond, director at Harrods Estates: “Despite predictions that the London market will remain flat next year, we are still seeing activity from our client base, of which approximately 75% is international – predominantly buyers from the Far East, Middle East and China. This is mainly contributed to the fall in sterling, which makes the exchange rate more appealing, especially for US dollar holders.

"We are advising our clients to look at their investments in London with a long term view. However, in the super prime property market, those that don’t need to sell are holding onto their properties, with many unwilling to reduce their asking prices because they are not in any particular rush to sell. There will always be a high demand to live in the prime areas of central London and as such, we don’t expect to see any further reductions in values which have been reported in some areas or particular developments in the news.”


Hannah McDougall, lettings manager at Berkshire Hathaway HomeServices Kay & Co: “The lettings department at Berkshire Hathaway HomeServices Kay & Co has seen an increase in choice available for tenants which is encouraging movement between properties as tenants are seeing an increase in value, and variety available leading many tenants to move out of desire for a change, or to take advantage of the market rather than necessity. The prime and super prime sector of the lettings market has continued to grow with an increase in these high end lettings again since last year and more notably since 2015/2016. A large boost to this market has been empty nest downsizers looking for exciting central London property to rent. For example, the rarely available penthouse within the Fitzrovia Apartments in Bolsover Street was available for at £4950 per week and let in it’s first week of viewings. The property hosts a duplex roof terrace of circa 2500 sq. ft. which features a Jacuzzi and 360 degree viewings of the London Skyline. It saw seen interest from a variety of tenants, including international professionals and families. I attribute this to the flood of interesting and desirable high end properties being available for lettings leading tenants to look for variety and opportunity in the Super Prime market. We are anticipating this trend to continue into 2019.”


Chris Coombes, lettings manager at Berkshire Hathaway HomeServices Kay & Co: “With uncertainty still swamping parts of the sales market, 2019 is set to be a big year for lettings.  We’ve seen a great level of demand right the way through the year, from both domestic and international tenants, even those within the EU, and I can’t see that this will slow down in the foreseeable future.  Marylebone and Mayfair are well placed to benefit from large multinational corporations relocating employees into London, the area, as ever, remains popular with a wide array of people and with its geographical convenience within London, demand is still there for excellent lettings properties.  My advice to landlords is as valid now as it has ever been, the expectations of tenants is higher than ever, especially in a W1 postcode, so do your utmost to get your property ship shape to attract the best tenants and a solid rental figure."


Charlie Baxter, managing director and co-founder of Alchemi Group: "The biggest topic of conversation in 2019 is unquestionably Brexit and what will happen to the property market post-March. In my opinion, the prices will continue to drift off in the first part of the year (they’re already about 20% lower than June 2016) due to the uncertainty surrounding the decision but will surprisingly bounce back very shortly after. By way of comparison, in March 2009 - following the credit crunch in 2008 - Westminster, in particular, experienced a 10-year low point in sales volumes, but then suddenly turned a corner and skyrocketed with a 30% increase in prices over a 12-month period. I think we could see a similar pattern to this following Brexit. The leading estate agents predict a 10-15% increase in the prime Central London property market by 2022, but I actually think the figure will be at least double this, because the reality is that there isn't a lot of stock (new build properties) available in prime Central London and yet the demand more or less remains constant from around the world. Thus, prices will inevitably increase once everyone feels calmer about Brexit.

"Aside from Brexit, London's property market will likely experience a spike in the new year with the opening of the Elizabeth Line. The excitement and impact of the Elizabeth Line hasn't really been felt yet. I don't think Londoners fully appreciate how much it will change their lives (and commutes!) but once launched, it will be hugely beneficial and all the stops along the line will no doubt reap the rewards in terms of house prices. As a general shift in the property market in 2019, I predict the government (steered by the Bank of England) will take the handbrake off lending, and the regulations that were put in place in 2008 will be relaxed, eventually causing the property market to be over-stimulated in the latter years of current cycle and banks to once again over-lend. 

“One such area in London seeing a real change post-Brexit is Victoria, not least because of the £700m upgrade to the transport hub by TFL, the huge ongoing regeneration led by Land Securities PLC, the potential benefit of Crossrail 2, and also because of the increased number of culinary offerings, most recently the opening of the Victoria Market Hall. Residential developments such as Westminster Fire Station - with starting prices from £850,000 - our new boutique development by Alchemi Group in partnership with Far East Orchard Limited, are underlining Victoria as a very desirable destination.”


Paresh Raja, CEO, Market Financial Solutions: “Brexit will no doubt continue to dominate the headlines over the first months of the year and this is not likely to deter property investment in the short-term. Based on current trends, house prices are set to continue rising over the coming 12 months, with a recent industry report suggesting that UK property prices are set to grow by 2.5% in 2019. Coupled with strong investor sentiment and high demand for property, the 2019 is expected to be another year of opportunity for prospective homebuyers and property investors. However, a strong focus will need to be placed on addressing the pressing housing shortage and ensuring that all groups have access to affordable property. In reality, this means that the ambitious goal of 300,000 new homes needs to be supplemented with new and innovative solutions to ensure that the supply of property can keep up with demand.

"As the property market continues to face significant challenges, we should be exploring creative new approaches like this that take advantage of the existing housing stock. The construction of new homes is certainly vital if we are to keep up with the growing demand, however it would be a missed opportunity should we not also take advantage of the houses that already exist on the market. As we look to 2019, a holistic strategy is required should the imbalance between housing demand and supply be effectively corrected.”


Melanie Omirou, group managing director, Acorn Property Group: “The lack of quality owner occupier new homes at reasonable prices in good locations will continue to drive demand throughout the South West and despite economic uncertainty and the difficulties of a broken planning system and we expect 2019 to be a good year.  In London where Stamp Duty and other tax changes have ruined demand at the top end any scheme aimed at owner occupiers and at reasonable price point will sell very well.” 


Will Herrmann, CEO and founder of West Eleven: “While the last two years, and particularly these last few months, have been tough on the market and presented challenges to those of us working in it, I am confident that the market can rebound in 2019, as long as there is a definitive plan and effective leadership. Both buyers and sellers have been wary, especially in luxury property; they don’t want to see their hard-earned pounds under-valued. Like-wise for developers and housebuilders – specifically those in London and the South East who have borne the brunt of falling prices and growing costs who are seeing more middling returns on their investment.

"Once there is a decision on Brexit – and hopefully it is a positive one – I suspect we will see more movement. Ultimately, the market is dependent on consumer confidence as much as the political environment. If the country can pull together behind a set plan, if we can see that there is a set plan, then progress and growth shouldn’t be far behind.”


Ben Babington, director of residential development at Jackson-Stops London: “Something many housebuilders in Westminster may have to contend with in the New Year is the Council’s plans to limit the size of new homes to 150m². In theory, the idea of limiting the size of new homes in Westminster is sensible, although 150m² is arguably too small given the typical purchaser demographic in Westminster. Given its zone 1 location, properties in Westminster are always going to be priced at the premium end of the market and a proportion of wealthy home buyers in this area will simply need more space. This is particularly true of people who will be using the property as their principal home. By not offering the right housing stock to satisfy demand, there is a danger that Westminster may increasingly attract pied-à-terre buyers and buy-to-let investors, instead of permanent residents and families. 

“It is important that planning policy is used to shape communities and expedite the delivery of new homes that are so desperately needed. However, Westminster Council must take account of the demands of the market with this potential ban. There is very good reason why developers have traditionally built a proportion of larger homes in Westminster - it is what the market wants in this location. The door should at the very least be left open for homeowners to combine plots if the demands of their lifestyle requires it.”


Louisa Hooper, head of new homes at Jackson-Stops: “The demographic of our buyers in the West Country has remained reasonably consistent over the last few years but this does vary depending on the stock available. Many of our clients are currently looking for low maintenance, middle to high end village homes in close proximity to good transport links and a range of amenities. We expect any properties that meet this criteria will be popular with families in the New Year, while new build coastal homes will continue to be sought-after by second home owners. The Exeter office currently has a lack of new homes with sea views, and so further development of this type of property would see an influx from both second home owners and investors into the market in 2019.”


Mark Pollack, co-founder and director of Aston Chase: “It is nearly impossible to predict and/or forecast what might happen in 2019 given the current political turmoil and the potential ramifications but whatever the outcome, life goes on and London remains one of the most desirable cities on the planet.

"We anticipate that the significant pent-up demand will result in surprisingly strong demand for homes from both buyers and renters although buyers paramount concern will be 'value for money' and vendors will need to ensure that they have all their ducks in a row as buyers, lawyers and lenders simply won't 'take a view' in this climate that heavily favours buyers who are willing and able to perform. I anticipate a two-tier market emerging with realistically priced properties attracting strong interest alongside best in class but everything else will be in the mix and vendors should increasingly recognise that selling a home could prove to be a long slow arduous process.

"Perhaps now more than ever, good quality full service estate agency businesses will benefit as the online offerings fail to provide vendors the support and advice required to navigate these previously unchartered waters. In reality, attempting to predict the direction of the London property market right now is akin to putting your money on red or black on a roulette table but then again, fortune favours the brave'!”


Paul Smith, CEO of haart: “It’s very promising to see house prices climb up on the month amidst choppy political and economic waters. November and December are typically quieter months for the property market, but I expect we will see a surge in activity across the country once the Christmas lull is over. We see website traffic spark back to strong levels between Christmas and New Year. The property hunting bug then spreads across the nation with sustained activity throughout January, as potential buyers start to look for a new home.

“The monthly drop in the numbers registering to buy in London, which coincides with a huge increase in the number registering to rent, is indicative of buyers waiting for the political in-fighting to blow over. However, if the government were to provide clarity on Brexit, this would act as an ignition to unlocking the market’s huge potential. Throughout 2018, the market has enjoyed a number of underlying strengths. With demand for property remaining significantly higher than supply, and a range of low fixed mortgages readily available, coupled with the fact that employment figures are at their highest in decades, there is plenty of reasons to be confident about the UK’s housing market going into 2019.”

“Sales to first-time buyers dropped off on the month in November by the most significant amount since the government’s stamp duty cut a year ago. But with our latest data indicating that the average first-time buyer deposit has decreased by a very significant 20% annually, I would urge first-time buyers to brush off the ongoing uncertainty and act now before prices start to climb back up again in the New Year.”


Lisa Simon, head of national residential lettings at Carter Jonas: “London’s market peaks of 2007 and 2014 initiated the greatest disparity between house prices inside and outside of London in a generation; however, today’s market tells a very different story. As the capital’s market has softened, more so than in the likes of the home counties, those who once left the big smoke in search of a more rural lifestyle and better bang for their buck may be attracted by this window of opportunity and could be motivated to buy back into London.

We anticipate that once we do have a resolution to Brexit, we could well see signs of a bounce back in the market. The indecisiveness of government surrounding the deal negotiations has caused a similar hesitance in the housing market and thus reduced momentum.

“The government has gone to great lengths to enable first-time buyers; however, there are still blockages further up the property ladder that are yet to be addressed, resulting in people only buying and selling if they have to.

“The market is simply waiting for some sort of development in the political agenda, and when that happens, we expect to see increased levels of stability and a higher number of transactions. Not necessarily back to the numbers we witnessed at the previous market peak, but we are hopeful that the market will show signs of improvement in the months that follow our divorce from the EU."


Nick Lieb, head of operations at Share to Buy: As we head into 2019, a general feeling of uncertainty in the housing market prevails. However, while the market for outright sale property may continue to cool, we anticipate that alternative routes onto the housing ladder, such as Shared Ownership, will remain in as much demand as ever. We were pleased to see the spotlight on Shared Ownership in the Autumn 2018 budget with Stamp Duty relief being extended to the scheme, demonstrating that the government supports the scheme as a real and effective solution to the housing crisis. By purchasing a share of a home, Shared Ownership offers buyers a more secure route to home ownership, while ensuring that their monthly costs are far more resistant to market shocks. Part-owning and part-renting means Shared Ownership homeowners spread risk and retain flexibility until they are ready to take the next step on the ladder."


Find out more about our property predictions for 2019


Alan Watt of Barratt Manchester
2 February 2024
We hear from Manchester head of sales and marketing Alan Watt about what great incentives Barratt is offering first-time buyers this year...Read more
Sterling Place (Barratt London)
22 December 2023
Stuart Leslie of Barratt London looks ahead to what London's property market may look like in 2024...Read more
Queens Cross (Mount Anvil)
18 December 2023
WhatHouse? speaks with Lucy Hopkins, marketing director at Mount Anvil…Read more
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