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’ve listened to all the experts in the market and share their property predictions for 2019. Keep reading to find out more...
Brexit set to have an impact on the property market at the start of 2019
With the Brexit situation yet to be resolved, the uncertainty is having a knock-on effect on many parts of the economy including the property market. So how will Brexit affect house prices in 2019?
Nick Leeming, chairman of national estate agent Jackson-Stops, believes that the Brexit position will mean it will be a sluggish property market at the start of next year.
He says: “As we near the end of 2018, regardless of the outcome of the delayed Brexit vote or Theresa May having to face a vote of no confidence, these very public political uncertainties mean that the property market will start very slowly in the New Year.
“The possibility of a second referendum would only prolong the uncertainty and in-fighting further and with every extra minute that passes while we are kept waiting on an outcome, the UK’s confidence dwindles.
“The government now just needs to focus on getting the best deal possible and then we as an industry need to ride the wave until a greater number of buyers and sellers feel more confident moving in the market again. Should this be achieved, we can expect to see stability at the middle to volume end of the market and we could even see a modest recovery in house prices in London, with the ripple effect felt thereafter in outlying areas, but until a deal is agreed nothing is guaranteed.”
Will Herrmann, CEO and Founder of West Eleven, is more positive. He says: “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.”
Sales likely to remain flat
Irrespective of the outcome of the Brexit negotiations, most experts believe that it is unlikely that property sales will grow in 2019.
Sales activity has declined over the last two years and annual transactions are significantly below the high of 1.7m achieved in 2006. Estate agent Jackson-Stops predicts that overall UK transaction numbers will remain low at around one million over the full year.
Mark Pollack, co-founder and director of Aston Chase, believes that realistic pricing will be the key to selling your home in 2019.
He says: “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.”
Property prices set to remain stable in 2019
As property sales in the UK continue to be slow, experts predict that house prices are likely to remain at broadly the same level throughout 2019.
The RICS Housing Forecast 2019 suggests prices will neither grow nor fall in the near future (0%) while Jackson-Stops predicts an average increase of just 1% in property prices in 2019.
However, some experts believe that the property market will begin to recover after the end of March.
Charlie Baxter, managing director and co-founder of Alchemi Group, says: “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 [Brexit].
“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.”
Low stock levels party to blame for static house prices
Stable house prices are partly the result of a shortage of housing stock and a lack of new properties being listed for sale. RICS data throughout 2018 has found that average stock levels remain near all-time record lows.
Paresh Raja, CEO of Market Financial Solutions says: “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.”
Uncertainty means predicting house prices in 2019 is difficult
Until there is some certainty about the type of Brexit deal that is in place, it is likely that uncertainty will mean the economy remains slow and house prices remain flat.
Making a prediction in these times is also difficult, as Mark Pollack, co-founder and director of Aston Chase, explains: “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.
“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!”
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