The results of a survey by Belvoir reveal that uncertainty over Brexit is thought to be having a significant impact on rental and house prices. A survey of a random cross-section of Belvoir’s franchisees from across the country, analysed for Belvoir by property expert Kate Faulkner, shows that 86% of franchisees predict that rents are likely to rise or remain static in 2019, with 77% predicting that house prices are likely to fall or remain static.
“Brexit featured heavily in the results of our survey, in which we asked franchisees for their views on whether they thought rents are likely to rise or fall in 2019, and their predictions on house prices.” confirms Belvoir CEO Dorian Gonsalves. “In addition to Brexit, our franchisees referred to other reasons including lack of supply and affordability. Typically, uncertainty about the future of the housing market results in three things – low numbers of transactions, price stagnation or falls, and rents struggling to rise, even where demand is higher than supply. However our survey suggests that rents in 2019 may break from past trends, with the majority of offices predicting rental increases or static rents, primarily due to government legislation and shortage of supply. In contrast to this, they are expecting a decrease in house prices.
“Out of four offices surveyed in the North West i.e. Belvoir Warrington, Belvoir Bolton, Belvoir Burnley and Belvoir Wirral, all offices are forecasting that rents will increase or stay the same in 2019 due to increased landlord costs from increased legislation and potentially the tenant fee ban. In the South East, we surveyed nine Belvoir offices, with six predicting that rents will decrease or remain the same, and eight offices predicting a fall in house prices in that region.
“As an example, Belvoir Tunbrige Wells, in the South East, reported that political uncertainty is prohibiting people from putting their properties on the market, and therefore stocks are low. People who have already put their houses on the market in this region are unable to find anything suitable to buy, resulting in an increase in the number of people looking for rented property in the three-bed plus family market.
“Feedback from our Belvoir Tadley office, which is also in the South East, states that the underlying fear of a substantial negative blow to house prices due to Brexit will cause an influx of new instructions, which in turn will push down prices overall.
“However, the Belvoir Doncaster office in Yorkshire, is much more optimistic about the market, as there is substantial investment planned for the region, and our franchisee forecasts a good return on investment.
“It is not easy to forecast rental prices and house prices for the year ahead, but political uncertainty is making it even more difficult, with Parliament failing to agree on the next steps for Britain. However, Belvoir franchisees know their own areas extremely well, and are in an excellent position to be able to advise on local market conditions and those areas that have the best opportunities for investment.
“For this reason we are advising anyone who is in the process of deciding whether to buy, sell, invest or rent, to make contact with their local agent. At Belvoir, we believe that ‘Property is Personal’ and our franchisees are fully committed to working with people to help them make the right decisions for themselves and their families.”
14% of franchisees expect rents to fall in 2019.
27% of franchisees expect no change in 2019.
59% of franchisees expect rents to rise in 2019.
40% of offices expect prices to fall in 2019.
23% of offices expect house prices to rise in 2019.
37% of offices expect house prices to remain the same in 2019.
Snapshot of views from Belvoir offices across the country:
Belvoir Sleaford (East Midlands)
“Due to the tenant fee ban we believe that rents will go up by 3-6% in 2019. Due to Brexit, we believe that prices will drop slightly as buyer confidence is low.”
Belvoir Stratford-upon-Avon (West Midlands)
“Brexit is having a catastrophic effect on buyer confidence.”
Belvoir Uxbridge (London)
“In the last two years prices in our borough have stayed the same (circa 1% increase PA). So predictions of more of the same are safe – but could easily prove wide of the mark. Brexit uncertainty and overpricing concerns weigh down on the economic success and long-term prosperity of the West London area and its attractiveness to commuters seeking homes close to employment in the borough and into London.”
Belvoir Doncaster (Yorkshire)
“Investment in the area on infrastructure and by large multinational companies is strong in and around Doncaster. Plans for the Northern Powerhouse are very substantial in the next two to three years, as are the plans for the Doncaster Sheffield airport. Employment prospects are good with wage growth likely, in particular in the distribution sector. Yield on investment is still strong in Doncaster. House builders are building many new developments in 2019; their research must stack up! For the above reasons investors are still buying in Doncaster so I do not see prices falling.”
Belvoir Tadley (South East)
“We believe that the underlying fear of a substantial negative blow to house prices due to Brexit will cause an influx of new instructions which in turn will push down prices overall.”
Belvoir Tunbridge Wells (South East)
“Political uncertainty is stopping people from putting their properties on the market, thus stocks are low. Those who are on the market can’t find anything to buy so we are see an increase in people looking for rented in the family market (three-bed plus).”