Head of Town Sales, Carter jonas, Harrogate
As we settle into the rhythm of 2019, thoughts inevitably turn to the year ahead and what it might have in store for the property market.
While many might yearn for a crystal ball when trying to forecast, we’ve attempted to demystify the market, which we hope will bring a level of clarity. To that end, we’ve broken our forecasts down into bitesize morsels:
Returning to town: Harrogate, along with many other towns across the UK, recorded unprecedented house prices in 2014 but since then, values have largely plateaued and, in some instances, softened. While price performance across Harrogate might once have proved prohibitive to many buyers, this hiatus in growth has opened new doors to those who might once have been limited to purchasing out of town in order to secure greater value for money.
By contrast, affordability is now a diminished barrier, and we predict many, from families and professionals, to second steppers and downsizers, may leap at the chance to return to the heart of the action. Such a desire among families to return to the town and city is a trend that has grown over the last 12 months, as they opt for the convenience of these areas over the countryside. We’re expecting to see more competition for centrally located town homes.
A market bounce: As one of the most protracted political sagas of a generation, Brexit has exerted an impact on market sentiment and buyer mentality. That said, once we have a resolution we could see the genesis of a market resurgence.
While government has bent over backwards to enable first-time buyers to take their first step onto the property ladder, blockages still remain amongst the upper rungs, resulting in people primarily selling as a result of death, debt or divorce.
Our market is simply waiting for a development in the political agenda and when that happens, it should instigate increased stability and an upsurge in transactions. We don’t anticipate an immediate return to the transaction volumes of 2014 but we are confident that the market will show signs of improvement in the months that follow Britain’s divorce from the EU.
Stock shortages for lettings: 2018 was an exceptional year for the lettings market; however, we anticipate that 2019 will see acute stock shortages as fewer investors come into the market, in part because of Stamp Duty levies applied to those who own more than one property.
Evidence indicates that some landlords have been selling up over the last 12-18 months due to a lack of clarity as to when and where the market is shifting. Stock shortages and increases in rent are likely to come about as demand outstrips supply, although it is our view that this provides an opportunity for aspiring landlords, as greater competition amongst tenants will provide an underlying strength to rents.
That said, more vendors, particularly at the top end of the market, are putting their home up for rent until sales market conditions show signs of improvement. This has started to shore up a new pipeline of stock at the top end of the market but it leaves the core middle exposed.
Ultimately, 2019 is set to see the emergence of the next generation of entrepreneurs and savvy operators. If you identify an opportunity plough forth without hesitation.