What does 2019 have in store for the residential property market?
Without doubt 2018 proved a bumpy ride for the London residential market. Naturally our old favourites such as Stamp Duty and Brexit reared their ugly heads but general malaise, lack of confidence and a shortage of quality stock were equally troublesome.
These of course were exacerbated by the current uncertainly making buyers worried to commit, sellers unsure whether to sell and international corporates delaying the acquisition of more, or even replacement staff in their UK.
The culmination of all these factors created an ill-fitting jigsaw puzzle whereby there were buyers and tenants without suitable properties to rent or acquire, as well as, homes on the market struggling to find purchasers or tenants.
It is difficult to assess how London residential property will react this year, bearing in mind that currently we are neither in nor out of the European Union, and we could just as easily exit without a deal or negotiate excellent terms providing Great Britain with a soft landing. As a general rule, lack of surety creates unstable and volatile markets, thus housing is therefore likely to suffer further this year. There is, however, the possibility that a very weak pound may see foreign investment returning once more which could go some distance to bolstering failing residential values.
The government has not assisted by previously adding additional taxes on investor landlords thereby reducing the number of homes for rental in the private sector. Furthermore, by banning agents from charging tenants to provide tenant references the cost will now likely come from the landlords to be added to the rents. Furthermore, the proposed tenants’ administration charge ban will also come into force which will, in turn, add to landlord costs and yet again push rents upwards.
Taking all aspects into account, my prediction for this year, depending on the outcome of the various votes going through Parliament regarding Brexit, is that London property will remain relatively static with a similar environment to 2018.
For those wanting to sell or let their properties over the next few months, I would strongly recommend that by pricing your property at the correct uninflated level, you will realise a better sale or rental price, than by asking too much and remaining on the market. Whilst the internet can be an effective instrument, it can equally stymie ones hopes of achieving over and above the current value, by providing historical information on recently achieved sale and letting prices of similar homes. As this evidence is so easily and readily available to those that wish to find it, the current and most essential tool is to go to the market at a realistic price, in order to garner as much interest as possible from the pool of buyers or tenants actively searching for similar property.
Managing Director, Heathgate