By December 2009, the UK housing market was barely starting to recover from the steepest downturn for decades. After the bumpy 2000s, the 2010s got off to a rocky start themselves, before the housing market found itself on a firmer footing.
As we bid farewell to 2019, the recovery is in a more mature stage. House prices have grown, but behind the scenes, a number of things have been shaping sentiment, which will continue to influence the markets as we head into 2020.
Brexit enters final endgame
In early 2019, Brexit was still far from certain. With a government lacking a majority without support from the DUP, former Prime Minister Theresa May tried but failed to pass a withdrawal agreement through Parliament three times.
This deadlock led to the first of what ultimately became two Brexit extensions. Mrs May’s intended 29th March departure date became 31st October.
A wait-and-see approach in the property market was followed by a burst of summertime activity, as buyers and sellers entered into the busiest time of year for transactions.
However, Mrs May’s departure in July and the arrival of Boris Johnson in Number 10 led to Brexit reaching something of an endgame.
Mr Johnson also failed to deliver on an EU withdrawal of his own, on 31st October, but as the following few months have shown, his political fortunes differ greatly from those of his predecessor.
A time of decision
In the midst of the political drama, Property Notify conducted its first poll open to readers, following the prorogation of Parliament. When it closed, 59 per cent of our readers were found to be supportive of Mr Johnson’s decision to suspend Parliament.
As it soon turned out, prorogation was a move that was ultimately found to have been unlawful by the Supreme Court, in a landmark ruling.
Prorogation was just the first step towards what became a dramatic election campaign. MPs gave in to Mr Johnson’s demands for a snap poll in December, and the main parties all filled their manifestos with policies aimed at rebalancing the housing market, through greater housebuilding.
The Labour Party showed a particular interest in ensuring a greater number of “eco-homes” could exist, as the environment also became a prominent part of the political debate in 2019.
Despite a tense campaign, with shifting poll numbers, the Conservatives ultimately won a majority of seats, their best showing since 1987, while Labour suffered its worst defeat since 1935.
One of the biggest trends seen on election night was the shift in voting behaviour in communities which had traditionally voted Labour, where voters broke with the past and voted Conservative.
With a majority of seats under his belt, Mr Johnson has wasted no time in putting legislation together, to ensure that Brexit is delivered without fail in January 2020, but now attention will turn to the transition period, and the final settlement to be agreed by December next year.
Section 21 – a break with the past
One of the biggest stories of the last 12 months was the proposed scrappage of Section 21 of the Housing Act 1988. Its scrappage would bring an end to no-fault evictions, and it was first reported back in April this year.
The government opened an official consultation on the matter, from July until October, and a number of landlord associations were highly critical of the idea, believing it would result in open-ended tenancies, urging the government to protect the rights of landlords.
The proposal started to take shape as something more set-in-stone, when it was included in the manifestos of the Conservatives, Labour and the Liberal Democrats. This suggested a shift in the political debate, with parties recognising a need to offer greater security to the millions of tenants living in the private rented sector (PRS).
With the election of a majority government, the Conservatives made good on their manifesto commitment, by including Section 21 scrappage plans in the second Queen’s Speech of 2019, in the form of a Renters’ Reform Bill.
It is still unclear what the legislative timetable is likely to be for this Bill, but it is likely to be carefully put together over the coming weeks and months, before it is finally brought before MPs sometime in the New Year.
For more information about the Bill’s progress, here is the House of Commons Library’s official page for it, which will be updated in the coming months.
Section 21 scrappage attracted some of the most attention from Property Notify readers over the last 12 months, with some claiming such a move would force them to seriously consider leaving the PRS as landlords altogether.
With demand for rental properties remaining strong across all parts of the UK, rents outpacing inflation and the supply of these properties remaining low, Section 21 is undoubtedly going to continue driving the conversation, in the coming year.
We look forward to continuing to report on the latest developments in the housing market in the coming weeks and months.
All of us at Property Notify would like to wish you a Happy New Year and success in 2020.