With a new year and a new decade, it’s a good time to put the uncertainty of Brexit’s impact on the market behind us.
To help you create your property goals and action plan, we’ve researched the property predictions, to give you a taste of what 2020 may bring the property market.
1. The fastest-growing cities in 2020
Here are our predictions for the top eight fastest growing citifies in the UK. This is based on the current population, planned developments, past population growth of over 11% and average rental yields of over 4%.
The cities, in no order are:
- Manchester – a city that continues to be a most exciting place to live and work. It is successful in continuing to attract young professionals with solid careers as well as young families
- Liverpool – is a city that has been tipped as a top investment location, due to the upcoming developments, bright career opportunities and increased rental demands
- Birmingham – in 2019, Birmingham attracted the highest number of foreign direct investments outside London and the South East. Although these developments are in progress, Birmingham is still experiencing an undersupply of homes, which makes this city a solid investment in 2020.
- Oxford – with public transport set to improve with the East-West Rail and Crossrail, Oxford’s popularity is increasing, and will continue to attract National and International students and young professionals with proximity to Oxford University.
- Cardiff – like Oxford, Cardiff is becoming a fast-growing city due to improvements to infrastructure. This has helped to boost connectivity to the city, as well as increase the amount of jobs within the area.
- Leeds – is in a similar category to Birmingham; the city is predicted to grow rapidly due to large planned developments and will continue to have a housing shortage. This will increase rental yields, with predictions between 5% and 7%.
- Nottingham – this central city has direct and easy access to London, as well as exceptional shopping, dinning and entertainment amenities. Nottingham is popular with students and young professionals.
- London – although there has been a slowdown in property prices, with a large population, it is unlikely that the housing shortage will end anytime soon in London. It is popular with students and young professionals and will continue to be a popular city for international investors.
2. What will Brexit Mean for House Prices in 2020?
There has been economic uncertainty surrounding Brexit, which has affected the property market. We have seen house prices fall in some areas and fewer sales occurring.
With the Conservative Party gaining a majority on the 12th December general election, it seems that the general public want to move forward with Brexit. However, the prediction of Brexit’s impact on the property market is still unclear.
Some experts say that the house-price slowdown is not actually related to Brexit but is part of the normal market correction that happens when we experience high housing prices.
We have experienced a slowing down of the housing price growth along with a 16.5% reduction in house sale transactions, which suggests that homeowners are waiting to sell, with existing homeowners delaying moving up the property ladder until the uncertainty has settled.
It also seems likely that housing prices may fall if a no-deal Brexit is reached. The good news is that with housing prices stagnated since the initial announcement of Brexit in 2016, it is evident that the property market has started to slowly recover in the last months of 2019.
Whether Brexit will impact the property market or not, the thing to consider when investing in property is whether the property is affordable for you now and if you’d be happy living there or letting it out for the medium to long-term.
If you are buying a property for the long-term, a further fall in property price won’t affect you, as the value would increase once the market has been corrected.
3. Supply and Demand in 2020
Although it seems that house price growth rates may remain slow for 2020, it looks like the housing demand is still significantly behind supply.
Even though there are several large developments that are in progress or being planned in several cities in the UK, the supply is not keeping up with the housing demand. There is still a housing shortage.
This means that the property market should be buoyant, especially in high-demand areas.
The impact of an imbalance of the supply and demand is that the rental prices are forecast to increase faster than housing prices, between 2.5% and 3%.
Investing in the Right Property for Your Goals
Maximising your property investment success starts with setting clear goals and strategies for you and your lifestyle.
We recommend that if you are thinking about investing in a property that you start by getting professional advice, so you can make a considered decision.
At REKA Property Management, we give our clients the facts about the property industry.
If you want to know how to achieve solid rental returns and have peace of mind with your property, then call us on +44 (0) 203 286 6468 or email us at Admin@RekaProperty.co.uk