With Brexit due to be delivered in 2019, many commentators are looking at how this and other factors may impact the housing market, and are making predictions about the state of the property market by the end of next year.
Upswing in price growth. As this year starts to fade away, we can see that growth was relatively low, but next year is expected to see some sturdy growth in housing, though not all over the country. Undeniably, different parts of the country fare better when it comes to growth with many external factors such as the state of the industry and infrastructure playing particular parts in the equation, but with the current house-building strategy potentially allowing an increasing number of first-time buyers onto the market, there is the potential for established owners to move up too.
The price swing is also likely to be deeply affected, as always, by location, with the South East continuing to see reasonable growth, but some of the best percentages continuing to occur in Northern Ireland and Northern English cities such as Manchester, while the North East will probably be seeing the smallest growth or possibly even price shrinkage.
Overall, with the locational variations taken into account, the expected growth nationally is likely to be between 2%-3%, but negative in some areas, but rising steadily in future years.
Skilled Immigrants Become a new Buying Class. Brexit is likely to result in educated and skilled immigrants becoming a new buying class in the market, and with salaries that will make a large portion of the market available to them. These high earners will be looking for property in the UK and will have a fair amount of buying power, which is likely to stimulate the economy significantly. Many market commentators are suggesting that the bulk of this buying power will be centred on London and the South East, though the rise of the Northern powerhouse may attract entrepreneurs and highly skilled migrants away from the traditional work centres.
In fact, the whole Brexit process may have much larger ramifications beyond simply leaving the EU, as the Bank of England looks at possible actions to protect the economy against uncertainty and may well use interest rates to calm the market. That could mean that some good mortgage deals also become available to entice borrowers into locking in for a couple of years while everything settles down again.
Rental will still be around. Despite changes to stamp duty hitting the buy to rent market, this will continue to be a strong driving force in the housing market, simply because demand outstrips supply and that is likely to continue for some years, even with the increased program of building. The general high cost of renting is also seen as a tie for many people, who cannot afford to seek out a mortgage all the time they are paying rent. This situation is unlikely to change until a substantial amount of low-cost housing becomes available in the market.