Brexit has impacted a lot of sectors in the United Kingdom. Among the most affected sectors is the London housing market which saw the anxiety of developers, realtors and homeowners alike generating an air of doubt what happens tomorrow. This atmosphere of uncertainty that Brexit caused has taken a toll on the residential market in London. Nevertheless, though the housing market may be undergoing rough times right now, London residential property predictions for 2019 are very positive indeed.
Crisis Translates To Opportunity
The great scientist, Albert Einstein, once said: “in the midst of every crisis, lies great opportunity.” There is no question but that the London property market is in the midst of an upheaval in the wake of Brexit. The air of doubt it has caused could wreak havoc on the housing market. So where are the opportunities?
Surprisingly, amidst the chaos that Brexit is causing, prices of homes are still increasing, though the rate has slowed. Still, it shows great promise. With the number of transactions showing signs of growth and international investors poised to take advantage of foreign exchange rates, London property remains a good investment option. How so?
When investors, developers and landlords make prudent choices on their London property, such investments can provide a generous return on investment. To give you an idea of how big an opportunity is in the London property market, take a look at what is in store for the housing sector this 2019.
There Is No Way to Go But Up
Real estate experts agree that the London housing market will bounce back soon. It is true that after Brexit negotiations, adverse tax reforms and investors looking towards cities in the North, the housing market suffered. However, positive indicators point to 2019 being the year London will takes back its spot as the ultimate property hotspot in the UK.
Economic managers and analysts say that London will continue to attract investors from all over the world in 2019. This is despite the air of uncertainty in the economy and the adverse surcharges that almost brought down the London housing market in 2018. This shows the resilience of London, and the United Kingdom as a whole, to the uncertainties brought about by Brexit. The appeal of the UK capital as a global hub for business, education and culture remain strong, further heightening the interest of investors from all corners of the globe.
When UK’s dynamic market went through a short slump in its activity in 2018, causing investors and landlords to hold off on investment plans until a more certain political picture appears post-Brexit, it did not dampen the hopes of many in the housing market. This year, 2019, we expect to see an increase in the volume of transactions, as political and economic scenes become more stable. These two factors can influence the sale and purchase decisions of investors regarding London properties.
Increase in London Home Prices Brexit-related uncertainty caused property prices in London to stagnate for a couple of months. This does not necessarily mean that housing prices are about to go down, as some have predicted – or hoped – as it is abnormal for property prices to decline in a growing economy. So, experts predict that starting in 2019, London will experience a significant and sustained increase in the price of homes. According to them, prices will further increase in the next five years by as much as 28%. This makes a London property investment a lucrative and safe one because investors will have the unique opportunity and to ‘buy on a dip’, and enjoy exceptional capital growth over the long term.
Real property market analysts reveal that the demand for prime properties in London will be driven by international investors in 2019. This is largely due to their intention to cash in on currency rates before the foreign buyer tax is introduced and implemented. American investors are expected to lead the pack in taking a huge interest in the property market in the UK, particularly in the capital.
With present foreign exchange rates presenting a 25% discount on London properties, the appeal of investing in the UK housing market, especially by US investors, is great indeed.
Another potential investor pool, who have been looking keenly at UK properties, are those from Asia. Mostly members of the new rich, they have the tendency to concentrate their investments on areas where they or their children can get a good education.
In Asia, education is valued highly, which is why it comes as no surprise if Asian investors focus on areas where world-class educational institutions are highly accessible.
Although it must be admitted that Brexit indeed presents some complications as regard to the destiny of the property market in London, the sector, in general, remains strong and resilient.
Like many times before, it has bounced back after some gloomy periods and this year, it is expected to do the same. This comes as no surprise since the economy of the UK, after all, is quite strong.
With the London real estate market about to break through the gloom and all set to go through a lot of positive changes in 2019, capital growth is definitely expected. Naturally, both international and local investors, as well as landlords, will be the first ones to benefit from all of these.
True, the property market in London may be undergoing a bit of crisis in the midst of all the doubts and anxieties on what happens when the day UK leaves EU arrives. All indicators do point to the fact that London property market is set to experience one of its best years in 2019.