What does this year hold for the Yorkshire housing market? We ask the experts for their 2019 predictions. Sharon Dale reports.
Andrew Wells, partner at Allsop
Unless Brexit is resolved quickly and cleanly, I foresee a more difficult sales market in 2019. Presently, there are too many reasons for prospective house movers to do nothing.
However, there may be a couple of exceptions. One of these is buying for investment. There are good rental returns to be had from a very active lettings market, so if investors can find stock available, next year could be a good time to buy. Buy-to-let may have fallen by the wayside for some people due to stamp duty and mortgage interest changes but those who have stuck with it know that there are plenty of tenants around and rental growth is happening. Residential investment still beats the stock market, in my view, over the medium to long term.
The second exception is in a few hotspots. We see Harrogate, Ilkley and York continuing to see price growth. I also tip Burley Park and Headingley in Leeds to do well as these areas reduce their reliance on students and create more balanced and attractive communities.
Tony Wright, Carter Jonas
We have undoubtedly been hit by declining transaction volumes due to the economic and political turmoil that has ensued following the vote in favour of Brexit in 2016. This uncertainty has had an impact on buyer and vendor mentality.
Having said that, the residential sales market in the Harrogate, Leeds and York areas performed well last year.
A particular feature is the noticeable shortage of new stock coming onto the market resulting in pent up demand, with motivated buyers waiting to pounce on the right opportunity.
The demand for city/town living is particularly evident with buyers seeking the convenience of having shops, restaurants and other amenities.
In terms of the outlook for 2019, we are confident that the market will remain active. Interest rates remain low and there is an underlying confidence fuelled by a good number of buyers who are ready, willing and able to proceed.
The aforementioned lack of supply will have a noticeable impact as will a hoped for resolution to Brexit. We could see signs of a bounce back in the market as Brexit uncertainty subsides.
Andrew Beadnall, Beadnall Copley
The housing market is sensitive to confidence and there is much political uncertainty concerning Brexit. The final outcome will have considerable implications for the year ahead.
Fortunately for our region, demand still outstrips supply and this continues to sustain house prices.
Ever since the EU referendum was called in 2016, the available stock of housing has been low and, according to the RICS, the average number of properties for sale on estate agents books is now a paltry 42.9 per cent.
However, the Harrogate, Ripon and Wetherby areas remain popular and certain parts of Harrogate are especially keenly sought, ensuring high levels of viewings and some properties selling for above their advertised price.
After 45 years in this industry I have seen enormous fluctuations in the housing market but throughout everything the market never “dies” as there are always many reasons for people’s need to move on and buy.
Despite my inherent optimism I cannot see prices increasing more than one to two per cent in 2019 but this firmly depends on whether or not we leave the EU with a no-deal Brexit.
Patrick McCutcheon, Dacre, Son and Hartley
The performance of the Yorkshire property market during 2019, especially the early months, is inextricably tied to what happens further afield in Brussels and Westminster.
The closing half of 2018 saw an increasing level of caution amongst buyers due to the uncertainty surrounding Brexit but we believe there to be a build-up of demand which will make itself known once/if Brexit is finally ironed out.
Despite Brexit, life goes on, and if uncertainty remains, growing families, marriage, divorce, downsizing and, sadly, death, will continue to drive steady volume of sales – all be it at current pricing levels.
If demand sees unfettered confidence, then we would expect strong price growth, especially in the £300,000 and £600,000 price bracket.
Unless the government tackles punitive stamp duty rates, we believe price growth within the upper sectors will remain checked to a degree. The finest homes in prime locations will always perform well, irrespective of trading activity, as we have seen this year, with a number of off-market deals struck on properties worth over a million pounds in Wharfedale and the Harrogate area.
Simon Blyth, Simon Blyth estate agency
I think Yorkshire folk generally have a positive attitude and I think Brexit will come and go with relative ease as this region has a diverse economy.
Under the circumstances, last year was good in terms of residential property activity in the areas covered by our 10 offices in West and South Yorkshire.
I anticipate that the residential property market this year will follow a very similar pattern to that of 2018 and I do not believe that house prices in Yorkshire will fall.
Other areas of the country are less positive but the Brexit vote showed that more people wanted to leave Europe than remain so if we do eventually leave Europe, as is planned, there should be some positive sentiment.
When Brexit is resolved people will feel that we can all move forward.
Edward Hartshorne, Blenkin and Co.
This is the year that the all-singing all-dancing traditional high street agent will re-assert its former position and make a bid for complete dominance of the industry. In 2018 the online model clearly didn’t deliver: the market share of online agents has fallen, and many have seen their share price dip or have gone into administration.
In times of economic uncertainty homeowners need to know that their greatest asset is being handled with care, skill and discretion. They need an estate agent with home-grown knowledge who will provide a greater certainty of outcome by doggedly driving a sale forward in the face of many obstacles, foreseen and unseen.
Service, when authentic and constructive, really does count and those estate agents who get the service right will pick up the greater market share in 2019.
For Blenkin & Co, 2018 was the best year in our long history and we are priming our business for continued growth throughout the coming year. Supply will be tight but Brexit, whatever the outcome, provides opportunities and we can see plenty of them directly ahead.
The north of England is set to enjoy a small degree of price growth entirely lacking in the south and the quality end of the market will be the greatest beneficiary. We have eager buyers who are moving up from London wanting to live within easy reach of good mainline rail connections at York, Malton or Thirsk. These are buyers who have emerged because of Brexit and we are ready to expedite their journey.
Nicola Spencer, Spencers estate agency
It’s hard to predict anything thanks to Brexit negotiations but Sheffield’s property market might be slightly unique.
It certainly doesn’t reflect any image of London. Even through the 2008 dramas and the rebuilding of confidence in the market, Sheffield prices didn’t drop like they did in the rest of the country.
In fact, they stayed relatively strong and stable. As values have strengthened and stock has remained on the low side, we have once again seen offers in their multiples for desirable properties in the areas most wanted by families looking long term. We have had up to 18 offers in some instances and have seen properties sell for well over list prices.
Who can tell what Brexit will bring for sure? I know though that we will all keep moving for the usual reasons and there will be those that benefit and those that won’t but it won’t dampen our Yorkshire spirit.
Glynis Frew, Hunters Property Group
This year is set to start in a similar fashion to that of 2018 with Brexit dominating the conversation. But no amount of Brexit can ever stop things ticking over. Whether it’s a new job, marital status or curiosity, people will always want to move.
A climate of uncertainty doesn’t exactly bring the feel good factor that the residential market requires to be at its strongest and that will explain the single digit growth I expect in 2019 but there are many pull factors that will always be there for Yorkshire regardless of politics.
Areas like the Golden Triangle will always have appeal that stretches beyond the confines of Yorkshire’s population. York will remain as a hub for commuters working in North and West Yorkshire and I can see East Yorkshire facing its challenges.
The Northern Powerhouse will continue to drive large-scale commercial and infrastructure investment to the county, especially to the likes of Leeds and Sheffield, and that will have a positive knock-on effect on the residential market.
Lenders are not showing signs of slowing down and, assuming that interest rates don’t see a drastic rise and yields continue to grow, house-hunters and buy-to-let investors will see Yorkshire as an attractive option.
Justin Dugdale, Yorkshire’s Finest
Yorkshire’s property market will be dependant upon the impact that Brexit has on the economy.
It was widely predicted that 2018 would be dogged by the uncertainty that Brexit creates. This has been far from the truth. In fact, the second half of the year was stronger than the first half in sales activity.
We are entering uncharted waters with our modern economy facing being out of the European Community but credentials of the property market are very strong with continued and steady annual house price inflation combined with low overall inflation rates and low interest rates looking likely to continue for the coming years.
If you then add in to this equation, easily accessible but sensible mortgage lending, it looks like the property market in Yorkshire will remain strong and I predict house price growth of between three and five per cent in 2019.
Ben Pridden, Savills
Last year was a fair year. House price growth in Yorkshire was positive to the tune of four per cent compared to negative growth in London and moderate growth of two per cent in the South East.
The biggest change since the referendum has been UK house sales, which were down seven per cent during the 12-month period up to September 2018 compared to the 12-months to June 2016, when the EU Referendum took place. Supply has been low in our market which has underwritten values.
Looking forward, our analysts are forecasting 15.3 per cent growth to 2023, with a two per cent rise in 2019 for the prime markets in the Midlands and North of England. This is assuming a fair outcome for Brexit. If there is a no deal Brexit, it is impossible to predict how the UK housing market might react. However, some of the house price correction figures in the event of a hard Brexit announced by the Bank of England are based on extreme scenarios and would be unprecedented in the context of previous downturns. They would also require a spiralling of interest rates, which is not forecast by any of the major economic houses.
My predictions for 2019 for the local market are that York city centre growth will remain modest while the mid-market in the sought-after York villages will outperform the rest of the area.
James Wort, Strutt and Parker
The market up north is very buoyant up to £1.5 million, especially in Harrogate where we have had a number of properties selling before even going onto the open market. The key drivers are schooling and downsizing into the town market. The trend of baby boomers swapping their old country pile for a townhouse within walking distance of amenities is one that I predict will grow throughout next year. Buyers moving back from London were also up 20 per cent in 2018.
House prices for 2019 look steady for the town market but some country houses not in prime commuter villages near Leeds, York and Harrogate may need to adjust their price. Buyers are more particular about their requirements in the countryside – from accessible train lines to new bathrooms, small things can become a sticking point and a reason to offer a lower price.
Harrogate townhouses and those within a three mile radius will always be hot property and with very little in the pipeline for new builds so far, there is no change on the horizon.
Richard Welpton, Quick and Clarke
I think that Brexit will be a distraction in 2019. The lower end of the market will remain strong with lower stock levels and faster transaction times. The middle to upper will slow as many buyers sit on their hands to see what happens.
In the East Riding we are somewhat insulated from the fluctuations in the general market, which if you read the national press, is all about London and the South East. The East Riding market is quite insular with most buyers selling and buying locally. As such, demand for homes in Beverley will remain very strong into 2019 and I doubt we will see any significant movement in price levels.
Investment properties have been affected by the change in Stamp Duty and mortgage interest tax rules and this is dampening the market, this is likely to continue unless there is a much required rethink around this. As a result, demand for rental properties is very strong and this is leading to rental price increases.
Jonathan Morgan, Morgans
In the decade to 2017, only around 50 new apartments were delivered each year in Leeds city centre. As a consequence, the city centre probably has greater latent demand for new housing than any other city in the UK.
In the context of a growing population, strong job creation and a very positive economic outlook, the under-supply of housing is a major threat to the city’s prospects.
However, 2019 will bring a sea-change in the rate of delivery of new housing for rent and for sale. CEG Southbank, SOYO, The Climate Innovation District, X1 South Bank, Leodis Square, the former Yorkshire Post building, Mustard Wharf, Marsh Lane Goods Yard, St Albans Square, Victoria Embankment, City One and Kirkstall Riverside are all substantial residential or mixed use schemes which are either now on site or fully committed.
While Manchester and Liverpool have drawn a great deal of attention and new investment in recent years, both from UK funds and overseas investors, there is a definite sense that Leeds is the next stop on the line.
Mark Manning, Manning Stainton
The strength of the market across our region has been clear to see throughout 2018 and we have seen good growth in both volumes and prices.
We saw a three per cent rise in the number of buyers registering and an eight per cent increase in the number of first-time buyers.
Our outlook for 2019 predicts two clear paths. A disorderly Brexit will affect the property market through an inevitable impact on both confidence and employment levels.
However, if we can retain a relatively stable political environment, the market will likely continue in the same vein as 2018 and we will see a steady growth in prices of around three to four per cent.