2019 certainly looks set to be an interesting time for the property market in the UK. Economic uncertainty surrounding Brexit has led to most first-time buyers and potential sellers playing the “let’s see how it all plays out” game as they are understandably reluctant to make a move until the final details are ironed out.
Still, the UK property market is historically resilient and has bounced back from worse pitfalls in the past, so for investors and developers, there are plenty of opportunities to be had in the next 12 months.
London Slowdown – The slowdown in the London property market began back in 2016 after the referendum vote and continues today. Affordability in the city is stretched and with interest rates rising, it will only get worse, with house prices in the city expected to fall by between 2% and 5% over the course of the year. It’s estimated that it currently takes more expensive London homes at least a year to sell and even more affordable homes (or what constitutes affordable in the Capital) are struggling to sell.
The North-South Divide – With house prices in the north surging and a slowdown in London (see above), could a closing of the North-South property divide be on the horizon? Between 2017 and 2018, house prices in Manchester leapt 7.2%, with regional growth of 5.1% in the North West. Compare this with a 0% growth in London over the same period and a market fueled by Brexit uncertainty and all of the ingredients are in place for a market where rental costs in the south finally start to match those in the North, meaning those previously priced out of the South may now be able to move there. Indeed, inner London prices are actually falling, and affordability pressures are expected to lessen even further throughout 2019.
Mixed Development – With young professionals increasingly looking to live closer to the city centre without giving up the conveniences of outer city living, mixed development neighborhoods look set to become more popular than ever before in the coming years. People are looking to get more from their places of residence today – a community where they live work and play. These developments are triple threats for both developers and investors.
A Built to Rent Boom – The build to rent sector is continually expanding, with cities such as Manchester, Birmingham and Leeds all key growth drivers as city living becomes more and more desirable for millennials. Developers are showing increasing confidence in the built to rent market, with numerous units currently being built in and around London and further afield.
Technological Embrace – Finally, the property market should continue to embrace technology in 2019 if it hopes to create a genuine disruption that could rock it out of its slumber. The market needs to adapt to the digital age and start taking greater risks if it hopes to stay afloat. Companies such as Andrews are taking things a step further – combining traditional services with modern innovations. That’s where the future lies – combining the best of the old with the best of the new.