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House prices in 2020. Will they rise or fall?

House prices in 2020. Will they rise or fall?

Buying or selling a home can feel like an endless merry-go-round for anyone caught up in a tortuous house move.

In one £1.5m property in East Sussex, the fairground nature of many property transactions has been taken literally. The converted Victorian bathhouse is filled with funfair nostalgia.

The home, which features a retro bowling alley, a basketball arcade game and a coconut shy above the sink, went on the market in 2019.

It is not just the features which were unusual. The very fact it was listed for sale was uncommon too. Listings in the UK housing market last year were down 8% on the previous year, according to property portal Rightmove.

The dominant feature of the market in the last 12 months has been caution. Many potential sellers decided to stay put amid political and economic uncertainty, amid the Brexit debate and general election.

A carnival-themed home may feel like the appropriate metaphor for the goings-on in Westminster last year. While this put off sellers, demand among potential buyers remained relatively stable.

 

Low interest rates meant mortgages were relatively cheap for anyone finding a home within their budget. First-time buyer numbers were also surprisingly healthy. Debt, divorce, schools and new jobs still prompted people to move.

That led to prices rising on average across the country, if only by a little, rather than wholesale property price drops. The Nationwide Building Society says, on average, UK house prices went up by 1.4% over the year. The falls were mostly seen in and around London – the market most affected by Brexit uncertainty.

Other areas of the country saw prices rise faster than wages and the cost of living. Mortgage lender the Halifax suggests that Billingham in County Durham saw the biggest average price rise, up 12.3% in October 2019 compared with the same month a year earlier. Ilkeston saw a 9.1% rise over the same period. The next eight on the list – Sale, Wilmslow, Blackburn, Bolton, Burnley, Chorley, Bootle and Southport – are all in the North West of England and saw price rises of 6% or more.

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Mike Winscott

Business reporter, blogger and a Londoner.

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