House prices have changed a lot in the last 10 years. As we kickstart into another decade, what does the year ahead hold for the property market?
Lender Octane Capital’s chief executive Jonathan Samuels said: “Price growth in 2020 is likely to be a lot more robust than in recent years but what we don’t want is for values to suddenly get ahead of themselves”
In 2019, on average house prices increased by 1.4% according to Nationwide House Price Index. Last year also experienced the uncertainty of Brexit for house buyers, according to Rightmove, the UK housing market was down by 8% since 2018.
Mike Shipside, Rightmove’s property expert explained: “With much of the political uncertainty removed, we expect that the number of properties for sale will recover as more new sellers come to market, making up some of 2019’s lost ground”
While the housing market should be considered on a local level, the property expert predictions below represent the average price rise in the UK for 2020:
- Miles Shipside, property portal Rightmove: 2% rise
- Richard Donnell, property portal Zoopla: 2% rise in prices
- Andrew Montlake, mortgage broker Coreco: 2% to 3% rise
- Henry Pryor, housing market commentator: 2% fall
- Andrew Burrell, Capital Economics: 1.5% rise
- Simon Rubinsohn, Royal Institution of Chartered Surveyors: 2% rise
- Russell Galley, mortgage lender the Halifax: 1% to 3% rise
The 2% rise could be good news for house sellers, depending on the area they’re in, they may be able to sell their property at a higher rate. For potential buyers, however, it could be a different picture.
The average UK house price, in December, was £215,282. For first-time buyers, affordability is the biggest challenge. Shipside said: “First-time buyers are the drivers of the market. Too many are struggling to save the necessary deposits, and not all of them want to buy a new-build home through Help To Buy. More ways of getting more people onto the ladder would help to limit rising rents, increase liquidity and transaction numbers in the housing market, and make the dreams of their own roofs above their heads a reality for many more of the younger generation.”
According to Real Homes, the 2% rise could be beneficial for first-time buyers, this is because of the increase being in line with the national minimum wage. However, as well as Rightmove’s property expert, Real Homes also agree that the government still need to implement more support for the younger generation to get their first step on the property ladder.
As per the Conservative manifesto, prime minister Boris Johnson had promised to build 300,000 new homes a year by the mid-2020s. Mr Johnson also promises to review the Help To Buy equity loan along with a “simplified” shared ownership, over the next five years.
Jonathan Samuels said: “The property market has entered 2020 on a positive note but all eyes will be on how the economy holds up as we exit the EU.”.
After the Prime Minister’s, Boris Johnson, Brexit deal was backed by MPs, the UK plans to leave the EU on 31st January. While the relationship between the UK and the EU is on the build, the first few months of 2020 could see a boost in the housing market. However, this may not stay consistent as the government begin to put plans together, we could see more caution in the sector throughout the year.
