"The changing political landscape throughout 2019 has undoubtedly caused uncertainty in the housing market, which in turn has affected sentiment and decision-making."
Propertymark asked its members to share their predictions for the private rented sector and the buying and selling market looking ahead to 2020.
84% of letting agents think rent prices will rise next year, up from 65% when agents were asked the same question last year, looking ahead to 2019.
61% think demand will continue to rise, but almost seven in 10 (68%) think the number of landlords operating in the private rented sector will decline next year, as they are driven out by rising costs. In line with this, 68% expect landlords’ taxes to rise again.
More than a quarter (28%) of estate agents expect house prices to fall next year, down from 43% last year when agents were asked the same question. Over half (56%) of agents expect house prices to stay the same.
A quarter of estate agents think the number of sales made to first-time buyers will increase and over half (58%) expect it to stay the same.
A third (32%) expect demand to decrease and a further quarter (28%) think supply will increase.
David Cox, chief executive of ARLA Propertymark, said: “For far too long, successive governments of all political persuasions have passed significant amounts of complex legislation for landlords. As a result, much of this year has dampened landlords’ appetites to invest and expand their portfolios, with many consolidating their assets, or choosing to step away from the sector altogether. This has impacted tenants most, who have restricted supply and have been faced with less choice and paying higher rents.
“Looking ahead to 2020, we hope the Government recognises the importance of increasing supply for tenants and uses it as an opportunity to make the market more attractive for landlords. This will encourage more landlords back into the market as well as ensure that tenants, including those who are most vulnerable, are not at a disadvantage in being able to find a suitable and affordable home to rent.
“Change should make the PRS fairer for all involved, and not penalise those landlords who provide high quality, affordable housing for thousands of tenants. Propertymark's election manifesto outlines a number of urgent housing reforms we hope the new Government will take forward to improve the sector, particularly regulating property agents through the recommendations of RoPA– the Regulation of Property Agents working group.”
Mark Hayward, chief executive of NAEA Propertymark, commented: “The changing political landscape throughout 2019 has undoubtedly caused uncertainty in the housing market, which in turn has affected sentiment and decision-making. Once the current political impasse is resolved and it’s clear how and when we’ll be leaving the EU, we hope there will be a degree of certainty which may trigger a flurry of activity.
“Regardless of the colour of the new Government, housing must be a priority. A clear strategy is needed to tackle key issues such as stamp duty costs. Additionally, we’d like to see the Government commit to bringing regulation into the sector as soon as they can in the New Year and to consider the introduction of digital logbooks to allow for a more interactive, streamlined and transparent process for home buyers and sellers. The housing market needs reassurance from the Government, which will in turn inject some confidence in the market for both buyers and sellers.
“Despite the difficult year, the UK property market remains a strong sector overall, and has demonstrated a huge amount of resilience in the face of political turmoil. We hope for a more certain outlook and some stability in 2020, which is hopefully provided sooner rather than later.”
