Experts are predicting that the UK's property market in 2019 will continue on the same "subdued" path as last year, although with some marked regional differences.

House prices outside of London continued to increase modestly

Over the course of 2018, market activity in parts of London attracted much attention although outside of the capital, house prices continued to grow modestly, with NW England recording the biggest percentage increases.However, the Royal Institution of Chartered Surveyors (RICS) believes that uncertainty over Brexit and tighter household budgets are likely to continue to result in falling demand in the year ahead."Uncertainty created by the Brexit process is causing buyers and sellers to sit tight in increasing numbers," the RICS reported in its latest poll of surveyors across the country.

Drop in property transactions for 2018 set to continue into 2019

An analysis of Land Registry data, published by modular smart homes provider Project Etopia in January, said there had been a 2.3 per cent drop in the number of property transactions completed in England and Wales during 2018.Among 374 local authority areas, only 133 saw an increase in the number of homes sold, the average price rise being 3.5 per cent. Stevenage, Newcastle-under-Lyme and Cambridge saw the biggest falls in transactions, while there were large declines in parts of London, particularly Croydon and Tower Hamlets.On the other hand, some areas in the regions - led by Chorley in Lancashire, Hull and Lincoln - saw a surge in property deals. The City of London saw the biggest increase of any local authority, but was starting from a very low base: it saw sales rise 66 per cent, but that only represented 146 properties changing hands.

Number of transcations for luxury properties and those over £1 million increased 

Properties in the City remain very much at the top end of the market and official figures analysed recently by specialist property lender Octane Capital showed 300 homes priced at more than £10 million sold in 2017, an increase of 50 per cent on the previous year.Meanwhile, the number of homes sold for more than £1 million exceeded 20,000 for the first time in 2017.Jonathan Samuels, chief executive of Octane Capital, commented, “The mainstream property market saw transaction levels tail off considerably following the EU referendum vote, but at the very top end of the market activity levels soared as ultra-wealthy opportunist buyers cashed in on rapidly softening prices."The weakness of sterling means a fair percentage of these buyers were almost certainly based overseas, as some of Britain’s wealthiest cities became a goldmine for foreign investors seeking a bargain."

Affordability and value of the pound is major factor for market rather than Brexit

Differences emerged, however, over what 2019 might hold. Savills believes it is affordability, rather than Brexit, that remains the major factor for the market. The agency is forecasting that UK house prices will rise 14.8 per cent between 2019-2023, although with significant regional variations.While London is projected to see growth of 4.5 per cent over this period, it will dip by two per cent in 2019. Meanwhile, the north west is expected to see a 21.6 per cent rise over the period. London’s prime market will also see double digit growth at 12.4 per cent over the five years, according to Savills.Rightmove, the country's largest online property website, foresees zero price growth across the UK this year and a one per cent fall in London. The firm believes that rises of between two and four per cent in the northern half of the country will be offset by falls across parts of the south.Miles Shipside, Rightmove director, said, “While buyer affordability is stretched in some parts of the UK due to house price rises having outstripped wage rises, the underlying fundamentals supporting the housing market are currently sound.

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"Positive employment data and affordable mortgage interest rates at high loan-to-value ratios are key to keeping property prices broadly in line with current levels."Corporate property consultancy JLL is predicting house price growth of 1.5 per cent in London during 2019 and 0.5 per cent across the country as a whole.JLL is predicting a bright future for the market with a return in confidence and a new phase of affordability when - and if - a Brexit deal is agreed. As long as that deal is done, the firm predicts house prices across the UK will grow by 11.4 per cent in the next five years.Simon Rubinsohn, chief economist at the RICS, said the organisation was forecasting a one per cent for this year although the number of homes being sold, as well as the prices that they are being sold for, was expected to edge down over the next three months.He said residential properties were currently taking an average of four months to sell, the longest period on record."It is evident from the feedback to the latest Rics survey that the ongoing uncertainties surrounding how the Brexit process plays out is taking its toll on the housing market," Mr Rubinsohn added. "Indeed, I can't recall a previous survey when a single issue has been highlighted by quite so many contributors."

Market creates bargains for cash buyers and anxious sellers

Nicholas Finn, executive director of Garrington Property Finders, said that country averages don't capture the contradictory conitions on the sales front line.“At one extreme we’re seeing a surge in the numbers of opportunistic, frequently cash, buyers emerging to snap up homes at large discounts. This is particularly true in London, where prices fell consistently for much of the year – with the weakness even spreading to the suburbs and southeast England by the end of 2018.“Sellers of homes who bought when the market was at its frothiest, or in areas without good transport links and schools, are often having to accept substantial reductions.“Meanwhile thousands of would-be sellers are instead hunkering down and waiting until things improve before putting their home on the market.“Despite the relative strength of the economy, these are anxious times for sellers, and many buyers will want the reassurance of a low price in order to proceed.“Together, the combination of a shortage of homes for sale and softening prices is prompting a steady stream of strategic buyers to pounce on buying opportunities that may not be around if the market normalises.”

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