What Will The Property Market Do In 2020?
The New Year is finally here and as we enter a new decade the big question is what will the property market do in 2020?
Over the past few days industry commentators, respected property market experts, agents and the major property portals have all been putting forward their predictions about the property market for the coming year and unusually, they seem to all agree, for the most part…
The overriding feeling amongst most is that we will see a rise in property prices throughout 2020 with some suggesting increases of up to 4%. But what affect is this likely to have on transactions and what will it mean to you?
Firstly, 2019 ended on a positive note.
Research from the Yorkshire Building Society shows that First Time Buyers entering the market reached an estimated figure of 353,436 in 2019, the highest level since 2007.
Furthermore, figures go on to show that 2019 was the 5th time in 6 years that mortgage buyers have exceeded 300,000 and that almost twice as many buyers secured a mortgage in 2019 than at the start of the financial crises in 2008 when the figure was 191,040.
Positive news indeed.
And given that an estimated 51% of all purchases were mortgage led, it could be suggested that a healthy mortgage market should result in a healthy property market with first time buyers being able to get access to funds and underpin transactions.
So what do the experts say?
Well, we have collated the predictions of a few industry commentators and asked what will the property market do in 2020?
• Rightmove – Rightmove are predicting an increase in house prices of between 2-4% with Northern markets benefiting more from increased transactions. They suggest that house price growth will be stronger in the Midlands and the North, with the South and London markets seeing only minimal price increases of around 1% in areas where buyer affordability is already stretched. If this prediction does prove correct, it could actually be a positive for the Southern markets enabling transaction levels to increase slightly as more modest price rises won’t put further pressure on affordability.
• Zoopla – Broadly speaking, the predictions from Zoopla match those of Rightmove, with a forecast for price rises of up to 4% in some of the most affordable cities but a more modest increase in London and the South. Zoopla suggests that transaction levels in the North will get more of a boost over 2020 than London and the South which will remain at much the same levels as 2019 due to affordability issues.
• Royal Institute Of Chartered Surveyors – RICS are painting the same picture as many other industry commentators, suggesting price rises of a more modest 2%. However RICS are tempering their predictions by stating that they don’t expect to see an increase in transactions over 2020 due to a lack of supply of properties coming to the market over recent years.
So What Will The Property Market Do In 2020?
In all truth it’s very difficult to predict. With a Brexit deal yet to be done, any predictions can really only be taken with a pinch of salt, but there are many positives if you are thinking of making a move.
Access to mortgage funds is still at an historic high and mortgage interest rates are lower than ever before.
First time buyer confidence seems to be steady and with an increase in first time buyers in the market more properties should be freed up and transaction levels may well increase.
As far as price rises go, modest increases of 2-4% could actually be a positive, tempting those who have seen the value of their properties increase into cashing in and increasing the supply of property coming to the market, but not at price levels that will further stretch affordability.
So if you are thinking of making a move, 2020 could very well be the time to do it!
If you need any advice about the market in your area or about buying, selling or renting a property, just pop in to your local Hannells branch or click the HERE!