Today’s investors worry about what the upcoming year holds for the property market. As a property investor yourself, you are likely aware of how crucial the price of homes and mortgage rates affect your returns. You may even assess the real estate value for your property investments to make good investing decisions. While your current knowledge is beneficial, it will not suffice when predicting next year’s market. You need to know about the pressing factors of property market projects for 2020 in order to gain a clear understanding of what you can expect.
With Brexit looming and fears of a no-deal being discussed, it is no wonder that investors in the UK are starting to worry about their current and future investments. This includes property investors who have concerns regarding house price growth. The property market has experienced a mixture of highs and lows since the 2016 referendum. It has recently been up and down since Boris Johnson called for the proroguing of parliament. It has since been disputed. This has left the nation in a state of limbo. Moreover, it also begged the question of whether property investment is worthwhile post-Brexit.
Here are some property predictions which will help you understand the possibilities regarding the property market and where you should look to invest.
The Strength Of The Pound
When the proroguing of parliament was announced, many MPs and UK citizens were outraged. Fears for a no-deal Brexit were heightened. This caused the strength of the pound to slip. However, once Boris Johnson lost the majority vote in parliament, and a no-deal became less of a possibility, the pound began to increase. It now stands half a cent up at $1.23, which is the joint highest amount in a while.
This increase will hopefully continue, offering investors hope of a similar rise with investments such as stocks, bonds and of course property. Then, people can continue investing in rental property successfully. Experts discussed how the political course could continue on this positive route away from a no-deal. They believe the pound could become even stronger. They believe that this would result in a lucrative future for investors in 2020.
Similar to the pound, property prices have experienced a significant amount of decline. This is especially true in areas like London and the South East of England. This could leave buyers with negative equity if a no-deal does come to fruition. Accounting experts KMPG discussed the fate of a no-deal. They stated that the whole of the UK could face a 6.2% decline in growth. However, if Boris’ plans are pushed aside and a deal is put on the table, prices could increase. They can potentially increase 1.3% by 2020, which is a small but encouraging result.
Investment experts are advising investors to stay clear of the capital and the sound and instead look to more prosperous areas. For example, the Midlands and the North West have experienced a significant amount of growth, so investors should look at properties within these regions. Property companies like RW Invest are already ahead with a number of developments located in the north-west, including Liverpool and Manchester. These are popular investment choices, as they are located in prime regeneration areas with high rental yields and the potential for capital appreciation which should experience significant growth in 2020.
Property investors should not be deterred from investing, especially in significantly lucrative areas. While it may seem that property growth is declining, it is actually starting to turn itself around lately due to favorable movements in parliaments. This caused predictions to show a steady but positive trend. Experts predict this trend to start from 2.6% and increase to 3.1% by 2023. This shows property investment is definitely still worthwhile. Keep your options open to ensure that you take advantage of the opportunities that are still present. For instance, do not underestimate how profitable distressed property investments can be. If you take this advice, you can still profit in 2020’s property market.
Property Prices Next Year
Furthermore, you need to take a deep dive into what the experts are saying about next year’s property prices. According to economists and analysts, property prices will likely rise in certain areas and fall in others. They expect prices in local housing markets to drop. At the same time, they predict that the housing market as a whole will rise in the upcoming year. With this being said, you need to look into the predictions for each city you may invest in. Then, you can assess this pressing factor of property market projections and make a well-informed decision.