Every January, Property Hub co-founders Rob Bence and Rob Dix make a set of predictions for what the year ahead will have in store for property.
Foolishly, they also revisit them on The Property Podcast the following year to see how accurate they were, so there’s nowhere to hide!
Their track record in recent years has been strong, so if you want to know what 2019 will look like – and what that means for your investment decisions – read on…
According to a round-up by the BBC, property industry experts are predicting anything from a 5% drop in prices to a 4% increase.
That’s quite a range! What’s interesting is that the experts who operate mainly in the south are a lot more negative than those who see more of what goes on in the north. This is a pattern we’ll see throughout our predictions for 2019.
So what do we think? Rob B believes that there won’t be price falls this year, and growth won’t exceed 3%. Rob D hasn’t given himself much wiggle-room at all: he also doesn’t think there will be falls, but believes growth will be no higher than 1%.
Averages are interesting, but they’re less meaningful than what’s happening on a local level – so we’ve also got thoughts on which areas will do the best and worst…
We’re going bold this year, and attempting to predict all five of the fastest-growing cities in the UK, as tracked by Hometrack.
In no particular order, our picks are:
Just to make it more precise (and make it more likely that we’ll look silly), we also believe that growth in each of these five cities will be higher than 4%.
London was the poorest performing region in the UK in 2018, and Rob D believes that’s going to be the same again in 2019. The uncertainty that’s weighing on the market is stronger in London than anywhere else, and that’s going to be reflected in prices.
Rob B agrees, and is going one step further by predicting that both London and the South East will fall in real terms in 2019. That’s not saying that prices will fall absolutely – although they might – just that any growth will be lower than the general rate of inflation.
We’ve heard apocalyptic predictions about what might happen to property prices in a variety of different Brexit scenarios.
Rob B doesn’t think “no deal” will happen, but his price predictions wouldn’t necessarily be any different even if it did.
And Rob D believes that the main effect of Brexit we’ll see this year will be in transaction volumes. Transactions were already low in 2018, and he sees them being even lower this year. As we (supposedly) come to the end of the Brexit process, more people than ever will be sitting tight while they wait to see what happens. That means less stock coming onto the market, and less being bought and sold.
You might think that with prices not moving much and most of the market pausing to see what happens next, it’s not a great year to be investing in property.
In fact though, there are opportunities in every type of market: you just need to change your approach. Sure, if you’re investing in the hope of big gains in the next year you’ll be disappointed – but property should always be approached as a long-term investment anyway.
As it happens, we believe you can see some good gains this year if you buy in the right areas: don’t let the UK average, dragged down by the South East, cloud your view of individual investment prospects.
But across the whole country, we think 2019 could be “the year of the cheeky offer”. Because the only people selling at the moment are those who really need to – and many investors are sitting out while they wait for more certainty – a low offer is far more likely to be accepted in 2019 than at any time since the immediate aftermath of the recession.
What do you think 2019 has in store for property investors? We’d love to know – so share your own predictions in the Property Hub forum.