It’s been a mixed year for the property market in 2018. With political uncertainty and Brexit dominating the headlines over recent months, it has been difficult to hear many positives about what is happening in the property market.
To find out what 2019 has in store for the housing market, we asked the opinion of a number of professionals from across the property industry
Read predictions from fellow estate agents and property developers, to mortgage consultants and the property portals, as we discuss what is going to happen to the housing market over the next 12 months.
Michael Ansell, Managing Director at Curchods and Burns & Webber
“Whilst completed transactional numbers this year have remained fairly constant compared to 2017, albeit reduced by circa 3%, what is noticeable is the absence of high value transactions, with homes priced over £2m being particularly affected. The market has lacked urgency in 2018 with the time taken to conclude a transaction being extended and buyers have been noticeably more cautious and in need of reassurance that they are making the right decision and getting value for money. Ultimately it is uncertainty that holds people back and hinders the desire to move a transaction forward.”
“What is reassuring however is the overall resilience of the housing market. 2019 should offer a more promising outlook as we expect to see those cautious buyers who have been sitting on the fence, start to take reassurance from a Brexit decision in one form or another. The sooner something can be announced the better.”
“We expect the trend of decreased activity from investment buyers to continue into 2019, very few transactions are taking place with investors looking to buy and let, this is particularly noticeable with new build flats that have previously been seen as attractive to investors in terms of value and returns. The Government’s hike in Stamp Duty Land Tax (SDLT) and the withdrawal of tax relief on loan interest will continue to squash (for the time being at least), this sector of the market as we move through 2019.”
“Over the next 12 months we expect to continue to see fewer buyers seeking to use funds raised in part from their existing property to finance an onward purchase, this sector of the market has also been deterred by the SDLT and taxation changes introduced by the Government in 2017. The result is that these buyers are no longer unencumbered and now need to sell before they can buy.”
“What we do expect to remain constant however, is an underlying market that is fundamentally sound. So when sellers are realistic and take good advice from a knowledgeable agent, sales will continue to be agreed.”
“Purchasers looking to buy as a home should take a longer term view, safe in the knowledge that despite peaks and troughs in the housing market, in the long term buying a property will always prove to be a good investment.”
Gareth Overton ANAEA, Head Of Residential Sales at Henry Adams Estate Agents
“2018 has proven resilient in the southern counties with residential sales remaining buoyant across the region, particularly along the south coast where the fantastic summer weather drew both visitors and homebuyers. Downsizing and relocating to the south coast has long been popular and is the strongest sector of the market, with the obvious benefit that it’s not too far for friends and family to visit from Surrey and the South London commuter belt. New homes continue to prove very attractive to people trading down in size but not in quality, and sales levels for new homes have remained positive throughout the year.”
“Turning to 2019, we anticipate a slightly subdued residential market in the first quarter as the Brexit negotiations and preparations take centre stage.”
“After April, with more political and economic certainty likely in terms of direction, we expect some of the more hesitant sellers and buyers to enter the market and a small flurry of pent-up demand is expected during the late spring and early summer.”
“There are always people who need to move for personal, financial or employment reasons so the underlying market is set to continue, albeit at perhaps a slower pace initially.”
Lars Gooch, Residential Development Director at Keatons Estate Agents
“It’s very difficult to predict the London and Home Counties property market at the best of times, but in this sustained period of uncertainty it’s even harder. What I think is almost certain for 2019 is further uncertainty, unfortunately!”
“Markets hate uncertainty and the property market is no different. Demand and turnover has been on the decline in central London for a couple of years now and that has rippled out to the suburbs and Home Counties this past 12 months.”
“Brexit has of course been the main driver to this widespread uncertainty but other key factors have been at play such as; sharp increase in Buy to Let stamp duty, legislation and taxation – all working against buyer’s motivations to move.”
“We know from history that the south-east property market is never subdued for long and that ultimately bricks and mortar will always be a very sound investment. Buyers who are moving from one purchase to the next really have nothing to fear as property prices at any given time are relative.”
“First time buyers now have excellent opportunities to find their dream home without the pressure of other potential suitors breathing down their neck, whilst being in a very strong position to negotiate with sellers. Mortgage rates are still at record lows, so for property investors there are good reasons to purchase if the right rental yield can be delivered.”
“Regardless of the Brexit outcome, hopefully post March we start to witness some confidence and normality return to the markets, which should in turn see some stability return to prices. But with so many variables on the table, no one really knows if the truth be told.”
“The private rental sector continues to gather pace, reaching right out to all parts of London and the south-east. The demand to live in London or close to a commutable town has in no way diminished despite Brexit. People still need and want to work in London and demand continues to out-weigh supply.”
“Prices continue to rise in many places due to the lack of new properties coming onto the letting market. Supply of lettings stock is a concern though, the rate of new properties coming to market has notably slowed and this is an unwanted consequence of recent Government intervention. But overall, we expect lettings price growth to outperform sales, and despite some legislation changes pending, the private rental market in the south-east will prove to be very robust and continue to expand over the next few years.”
John Morgan CeMAP, Sales Manager at Curchods Mortgage Services
“I believe the outlook for the mortgage market for 2019, will be focused around a number of factors, being new lenders entering the marketplace, continued growth in specialist lending areas and finally potential interest rate activity.”
“Tackling the subject of interest rates, movement can usually be linked to activity around the Bank of England base rate, which Mark Carney and the monetary policy committee control based on the current economic standing.
“Certainly, the outlook will significantly depend on the nature of the UK’s withdrawal from the EU. Be that a smooth transition, a hard exit or even a disorderly exit, the outcome could potentially result in a base rate rise, a reduction or continuation of the status quo – I would believe the latter being the most likely.”
“2017 saw gross mortgage lending reach £256bn and it is currently predicted that 2018 will finish higher than this at £270bn. However, based on potential pressures that we could see in 2019 on house sales, I would think that a return to a level closer to 2017’s figure could be a likely outcome.”
“As with 2018 it is likely that there will be continued growth in areas such as Help to Buy and Equity Release & Lifetime mortgages.”
“Both are areas that have grown considerably in 2018, with the Equity Release market growing from £3.06bn in 2017 to potentially over £4bn in 2018.”
Richard Donnell, Director of Research at Zoopla
The mix of buyers in the sales market has changed over the last decade. First time buyers have been the driving force for sales in recent years and we at Zoopla expect them to be the largest group of house purchasers in 2019, accounting for two in every 5 sales.
Irrespective of Brexit, we predict that house inflation will be somewhere between 2-3 % in 2019.
In addition, remortgaging will grow and mortgage rates will start to drift higher. There will be room for further rental growth in the regional markets, however London will continue to flatline, whilst affordability is stretched.
Miles Shipside, Director at Rightmove
“While buyer affordability is stretched in some parts of the UK due to house price rises having outstripped wage rises, the underlying fundamentals supporting the housing market are currently sound. Positive employment data and affordable mortgage interest rates at high loan-to-value ratios are key to keeping property prices broadly in line with current levels.”
“Home movers are being negatively influenced by the ongoing political uncertainty, and a more certain outlook would obviously assist market sentiment.”
“Whilst uncertainty traditionally deters some discretionary movers, particularly at the high end of the market, there are many would-be buyers and sellers who will be getting on with their lives and will be keeping the market moving.”
Mark Knight, Managing Director at Runnymede Homes Ltd
“When asked to give my predictions for the property market in 2019, the answer is certain; it is very unpredictable. Continuing uncertainty around the direction and outcome of Brexit has driven more businesses and individuals to ‘sit on the fence’ and delay making any major investment decisions – a ‘wait and see’ attitude prevails. This applies whether it is individuals or families just looking to move house or property developers considering new land development opportunities. Growth in property values in London has for some time been negative and there is plenty of evidence to suggest that the trend has spread along the A3 corridor and to the south east in general.”
“Apart from the occasional dramatic headline, for some time negative housing market news has been away from the front pages, which are dominated by Brexit and the extraordinary turmoil of politics today.
“At the lower end of the local market, sales and prices of new homes have been sustained by the Government’s Help to Buy scheme.”
Help to Buy in its present form is due to expire in 2021, after which it is to be re-targeted at First Time Buyers with regional caps on price eligibility and an extension for 2 years only. The evidence suggests that without the scheme, affordability again becomes a bigger issue.”
“Changes to Stamp Duty inflicted on the housing market by the previous Chancellor of the Exchequer have had a major effect on the landscape of the market much over £1m, increasing the tax take to the Treasury dramatically. The Chancellor has no interest in reducing SDLT, which has drawn more transactions into its net. The impact is most heavily felt in London and the south east, where it appears the Government has made a conscious policy decision to constrain and, at the top end, drive down house prices. With the low cost of borrowing and large amounts of cash available, conditions should be ripe for a healthy market for movers, but given the huge tax demand now levied on those in London and areas like Surrey, the disincentive to moving is very significant.
“I predict that the Chancellor will make no changes to SDLT and transaction numbers will limp along at the substantially reduced levels seen in the past year.”
“SME residential property developers encounter ever-increasing obstacles through the planning process despite changes in the National Planning Policy Framework (NPPF) aimed at promoting and simplifying development. Populist rhetoric pointing to developers land-banking has been found to be flawed, with most developers eager to implement consents quickly and efficiently, but frustrated by ever-increasing planning conditions and fewer and fewer planning officers to attend and approve these constraints. The ideal of there being dialogue with local planners to achieve acceptable outcomes in new developments is just that, an ideal. In practice, there is little opportunity for discussion with planning officers, due in large part to local authority cutbacks, resulting in delays in decision making. Without greater resource, it is hard to see how improvements in planning decision making can be delivered.”
“It is widely acknowledged that there is a shortage of homes to meet demand in the UK and construction of new homes at the rate of 300,000 per annum is needed if demand is to be met. Recent data shows that the upward trend in delivery has slowed markedly during 2018 and the accompanying slowdown in sales transactions will have house-builders and developers taking a rather more cautious approach to investing in new sites than has been seen during the growth period from 2009/10. ”
“From a personal perspective, I am optimistic for the future and, whilst the road immediately ahead is likely to be bumpy, there is great resilience of spirit in the UK and vigour for improving our situations and that of those around us.
