January Market Comment
Happy New Year to you all! We hope you enjoyed your festive period.
Yet another year has passed, in particular 2019 was a challenging year for all in many aspects, extra legislation, reduction in rent due to a drop in demand largely due to Brexit and for us most noticeably the abolition of fees with the Tenant Fee ban to name a few. All combined to create a perfect storm which was often hard to navigate.
So on to 2020, a new Government has been formed, and we hope it is back to business as usual, a word we are hearing more and more in agency circles is "stability" we should see more certainty in financial markets this year, and this unlocks recruitment, job movers and upsizers, which in turn creates tenants! EU tenants in particular may find clarity over coming weeks which may prompt them to come to the UK again, in fact 25% of all or our tenants on average are from the EU, so this is a lifeblood to often filling a large portion of our rental properties.
High quality rental investments may however be excellent performers in 2020. Supply is down by 7.8% since the same time last year yet demand continues to rise, promotion a doubling in rental yield growth in the past year alone (source Hamptons).
Those buyers and potential sellers who understandably adopted a wait-and-see approach during those politically uncertain times are now expressing their pent-up desire to move and the brakes are off.
This does not however mean that prices will suddenly rise. This is because the increase in new buyers entering the market will be more or less matched by the number of new sellers entering the market between now and Easter. So activity and transaction volumes will rise, which is good for those buying and selling as the additional fluidity provides greater choice and faster moves.
House prices themselves, which are notoriously difficult to foresee, are generally predicted to rise by modestly in 2020, of around 1.5% to 2.5% - effectively keeping up with inflation. Regional variations will be huge of course. In fact, over the past decade, although the average upturn has been around 27% this is very much an average with wide regional variations ranging from +101% (Waltham Forest) to -8% (Aberdeen) with all points in between. So beware averages in both reported figures and predictions!
The key message to sellers is that as long as you are not unrealistically ambitious on your asking price, then you WILL sell. This is a time of renewed hope and optimism. We are a stable and prosperous country that has definitively moved away from uncertainty – and we are passionate about home ownership!
If you’d like to take advantage of the opportunities of the moment, then please feel free to call us on 01202 554470 for a free marketing proposal and suggested asking price valuation of you property. No strings attached and you might be pleasantly surprised!
January Market Comment