U. K. Prime Country Home Prices Still Impacted by Brexit in Late 2019

According to international real estate consultant Knight Frank, prime regional country house prices in the United Kingdom were unchanged in the final three months of 2019, taking the annual change in values to -0.8%. Prices have been flat or declining for the past three years.

Political uncertainty continues to be the biggest single constraint on the market, agents note. The run-up to the general election in December added to this, with some buyers putting deals on hold while awaiting the result and some vendors holding off bringing properties to market.

Key highlights from the report include:

• The average number of new prospective buyers registering their interest in purchasing property per Knight Frank office was 9% higher in the 11 months to November 2019 compared to the same period as last year.

• Knight Frank forecasts prices in prime regional markets will rise by 1% in 2020 and by 11% over the next five years.

• Prime regional house prices were unchanged in the final three months of 2019.

• After three years of flat or declining prices, in 2019 the change in values is -0.8%

That said, overall demand has remained strong albeit price-sensitive. The average number of new prospective buyers registering their interest in purchasing a property per Knight Frank office was 9% higher in the 11 months to November 2019 compared with the same period last year, for example.

The certainty afforded by the outcome of the election should result in some of this pent-up demand being released into the market. The extent to which this translates into transactions in the short-term will depend on the size of the pricing expectation gap between buyers and sellers.

Supply is likely to rise in the New Year as vendors anticipate stronger market conditions. While some may expect these conditions to support higher prices, any growth in supply will potentially apply downwards pressure, and therefore demand will remain price-sensitive.

Rupert Sweeting, Head of Country Sales, Knight Frank commented, "2019 saw a year of uncertainty caused by delayed Brexit and the general election. Looking forward, the fog will lift with the newly elected government's clear majority allowing some certainty and a return of confidence to the property market in 2020. Buyers who have been 'sitting on the fence' can move forward and sellers will be assured that there will be an increase in the number of parties wanting to buy. Consequently, there will be an increased volume of stock allowing for more choice"

Oliver Knight, Associate, Knight Frank Residential Research also commented, "The certainty afforded by the outcome of the election should result in some of the pent-up demand being released into the market. The extent to which this translates into transactions in the short-term will depend on the size of the pricing expectation gap between buyers and sellers. Supply is likely to rise in the New Year as vendors anticipate stronger market conditions. While some may expect these conditions to support higher prices, any growth in supply will potentially apply downwards pressure, and therefore demand will remain price-sensitive."