What Does 2020 Hold for the UK Property Market?
Nick Leeming, Chairman of Jackson-Stops, shares his insights on what we can expect to see from the UK property market next year.
The UK has suffered a long period of political turmoil since the referendum and once again it has been thrown into a state of flux due to the announcement of a general election. However, whilst the knee-jerk reaction from some sellers may be to hold off listing their property until after the general election result, in truth this will have little impact on the housing market simply due to the time of year it has been called. The market is historically quieter throughout this time as vendors often wait to list their homes in the new year. However, some homeowners will be waiting for the outcome of the general election before they put their home on the market. We therefore expect to see a greater increase in activity than the usual in January next year.
We also expect average UK house prices and transaction levels to remain relatively stable in 2020, with the market predicted to experience marginal price uplifts of around 1.5% on the assumption that the UK leaves the EU and that this results in greater political stability. Properties priced between £500,000 and £1 million will continue to be in demand, particularly in the three to four-bedroom range. This prediction is supported by results to our 2019 property market sentiment survey, which analysed the views of more than 1,100 consumers, and found that almost six in ten buyers would most like to move into a home of that size next year.
Private sales in the country homes market
Over the last year, our country branches reported a significant uplift in the popularity of eco-friendly country homes with strong energy efficient credentials as owners become far more conscious of the cost of running a property. With waste reduction and energy efficiency such a hot topic, they are also becoming far more aware of their carbon footprint. Therefore, when it comes to buying a new home in the country, regardless of whether it is a new build or a period property, many are keen to understand what eco credentials the home has. It is sometimes assumed that older properties are less energy efficient than new build homes, but owners can make small changes, such as installing new appliances, which can help reduce their CO2 emissions and boost their ‘forever home’ credentials. It is these homes that we expect to fare well in the country market next year.
We also expect to see a rise in commuters and second home buyers moving to countryside towns and villages in 2020. Those buyers who haven’t had a pressing need to move or buy a second home have held off doing so over the past few years. However, once we have clarity on our newly elected Government and Brexit is underway we expect these buyers in urban areas to spring into action and we should see this reflected in transaction numbers.
Private lettings in the country homes market
Rental prices within the country market are expected to remain relatively flat throughout 2020. There is currently a lack of confidence from businesses in the North West in Government’s policy with regards to general commerce activity in a post-Brexit setting. This has had a knock-on effect on large companies’ decisions to recruit and expand, which means that in turn tenants are becoming less secure in their careers and are unsure of their job progression. This means that those tenants who may have been preparing to upgrade their current rental property are putting the brakes on this for now until their employers can provide them with stronger job stability. This lack of job security should have a positive impact on the rental market in these city hotspots next year however, as those unable to commit to purchasing in an area turn to rental accommodation as a sensible alternative.
The super-prime lettings market in the North West, in areas such as Alderley Edge, is largely driven by movement in Premier League football. This demographic of buyer is fairly immune to any changes within the local, national and global economy and so Jackson-Stops expects activity in this part of the market to remain broadly flat. Our agents in the North West find that the Premier League clubs have a thorough understanding of what the respective local market rents are, and therefore offer their players guidance on the rental prices they should expect to be paying.
More than 100 miles south however in Northampton many would-be buyers are turning to the lettings market for their next home. Not only is this demographic made up of those looking to ‘try before they buy’ but over the last year many former homeowners have decided to sell their property and rent a family home instead whilst they gain a better understanding on how the market in their area is likely to fare post-Brexit.
The new homes market
Prices of new builds across the country are expected to remain stable, with political delays putting a short pause on the market. High-end boutique, new build developments that are built in the traditional country house style are expected to fare well throughout the year, following a clear demand for them throughout 2019. Our research, for example, revealed that 77% of the UK public want to see period style features incorporated into the design of their new build property. Bay windows and sweeping staircases in particular are expected to become increasingly popular features for new homeowners in 2020.
Kindly shared by Jackson-Stops