Conclusive results from this year’s general election, which saw the Conservatives winning an overall majority could aid the housing market in 2020, with Rightmove forecasting prices to grow by 2 per cent during the next 12 months, as pent-up demand finds a release, particularly in the springtime.
Rightmove described the election results as offering a window of certainty for home movers in the coming year, especially as the housing market moves into the spring moving season, when activity often accelerates.
This comes, as average asking prices were estimated to have grown 0.8 per cent annually in December, to £300,025.
Positive tidings for the property markets in 2020
The forecasts from Rightmove paint a positive picture for the housing market, as first-time buyers are expected to show continued resilience, much like that observed in the last calendar year. Since the EU referendum in 2016, demand has held up, despite the significant political deadlock in Westminster, which contributed to an atmosphere of uncertainty for many.
Rightmove expects prices to continue growing in 2020, due to the continued strength of demand relative to supply. Demand has been estimated to have remained fairly stable in recent months, while the number of sales agreed in 2019 is down slightly, by 3 per cent, compared to 2018. Meanwhile, the number of new properties entering the market is down by 8 per cent.
The situation is expected to be skewed in the seller’s favour, according to Rightmove, as sellers show greater pricing power, and potential buyers are constrained by a lack of suitable properties to choose from.
First-time buyers face a harder 2020 however, as many are likely to struggle to save on deposits, Rightmove claimed, while many might refrain from buying new-build homes through Help to Buy.
Suggestions for moving forward
Rightmove stressed that first-time buyers, who they dubbed to be the drivers of the market, should have greater assistance on getting onto the property ladder, suggesting ideas to help limit rising rents, and offer greater liquidity to them, as they prepare to seek out their first homes.
Miles Shipside, director of Rightmove, added: “The fundamentals remain sound, with low interest rates, lenders competing to lend, high employment, and average wage growth outstripping house price growth and helping buyer affordability.
“The statistics for 2019 encouragingly show that the ‘have-to’ and ‘life-stage’ markets have been carrying on, and we hope that a more certain outlook would encourage many would-be discretionary movers to finally get off the fence.”
Latest developments in Westminster
Over in Westminster, the new government is solidifying its position, with a bill aimed at ensuring that Brexit is delivered by 31st January 2020 proposed to be enshrined in law, to prevent any further delays to the UK’s departure from the EU.
A new Queen’s speech is expected today, outlining the government’s legislative agenda, but in a far more pared-down fashion, given that the previous Queen’s speech was barely two months ago. The main distinction for the new speech is that it’s highly likely to include some of those core Conservative manifesto pledges.
The Labour Party continues to process the fallout of its worst election defeat since 1935, with leader Jeremy Corbyn confirming he will resign by early 2020. The party is expected to conduct an intensive leadership contest in the meantime, with figures including Lisa Nandy, Emily Thornberry, Keir Starmer and Rebecca Long-Bailey expected to put their hats into the ring.