A warning has been issued by a prominent industry figure that more bricks-and-mortar High Street agents will go under in 2020, despite a likely recovery in the mainstream housing market as the Brexit uncertainty subsides.
The warning comes from David Alexander, who established a family-run property management business 37 years ago and is now joint managing director of Apropos - a digital platform launching this year.
He says: “I believe that the coming year will continue to see the transformation of the estate and letting agency market as the business continues to move online with local support through the development of hybrid partnerships. Therefore, there will continue to be more High Street casualties as the bricks and mortar approach diminishes due to high costs and changing social patterns.”
Alexander says this churn will continue apace despite increasing confidence in the market.
While there remains considerable uncertainty about the UK’s future trade relationship with the EU, the General Election has prompted what he describes as “growth among individuals and investors buying properties both for homes to live in and among the private rented sector.”
His firms analysis of house prices since the June 2016 Brexit referendum shows that house price growth halved in the 40 months since the vote compared to the 40 months prior to the vote.
“Clarity and certainty are essential components of the property market and everyone, from someone moving to a larger home, to major investors has been rattled by the Brexit drama and its apparent open-endedness. Of course, while there remain enormous challenges ahead and serious questions about the future trading relationship the UK has with the rest of the EU, there is a feeling that the process has been unblocked and that planning for the next five to 10 years can go ahead” he adds.
“The underlying conditions for increased house price growth are in place with the UK population predicted to grow by over 300,000 per annum for the next 20 years which means demand will remain high” notes Alexander, who believes the north of England may well see the strongest price growth if the government’s pledges to improve infrastructure come to fruition.
“The detail contained within the forthcoming Budget will be a strong indicator of which direction this government is taking on fulfilling its electoral promises in the north of England and the consequent impact on the housing sector” says Alexander.