The UK property market has experienced a tumultuous couple of years, making it particularly difficult to accurately forecast property market changes. Having the right source of trusted information is vital to anyone moving home or investing in property, so we spoke to Andrew Frost to get a clear picture.
As Head of Residential EMEA (Europe, the Middle East and Africa) for JLL, Andrew has a wealth of knowledge and research insights so you can make an informed decision about the future of the UK property market.
What are your predictions for the UK’s property market in the next five years?
AF: We forecast that the average growth in UK house prices in 2020 will be in line with 2019, increasing by around 1%. However, with the Conservatives winning a strong majority in the recent General Election we now expect Brexit to progress to the next stage and greater certainty to gradually return to the UK housing market. As sentiment begins to improve for households and businesses over the next 12 months, we expect price growth to begin to increase. Over the next five years we forecast average house price growth of 2.8%pa and cumulative house price growth of just under 15% for the period.
Do you have any advice for owners thinking about selling in London this year?
AF: The next 12 months is expected to see a gradual increase in demand from aspiring purchasers who have previously put their plans on hold in the face of the recent political uncertainty. This uptick in demand is likely to be notably evident in the second half of 2020 as house price growth begins to accelerate. Now would be a good time for owners thinking of selling to get their house in order, so to speak, and make their home ready for market.
Which areas of London would you invest in and expect to see the greatest return?
AF: Large scale regeneration areas in London will typically see greater returns over the longer term. Investor patience should be rewarded in regeneration areas as new development is completed and demand for those areas increases. The likes of Stratford in the East of London and White City in the West of the Capital are seeing major new development activity which should make them good investment locations in the longer term.
You have 10 minutes alone with Boris Johnson, what property related changes would you suggest he makes?
AF: Housing policy rightly tends to focus on the first rung of the housing ladder to support first time buyers and maintain an overall healthy housing ladder in the process. However, we would encourage the Prime Minister to consider policies aimed at the last rung of the ladder as well which support the development of aspirational senior living communities as well as encouraging senior citizens to right size from the homes they are increasingly likely to be under occupying. By 2030, around 25% of the UK population are expected to be over the age of 65 as life expectancy continues to increase. There is both a great threat and a great opportunity in ensuring we have a housing market that accommodates this fundamental demographic shift.
HS2 and Crossrail – Is this money well spent or would you consider scrapping?
AF: Significant investment in new transport infrastructure is vital for opening up new markets and facilitating the opportunity to create new places for people live. Investment in connectivity is generally good value for money for the public purse. Improved transport connections will remain one of the most effective forms of improving connectivity. However, increasingly infrastructure investment will need to focus on improving digital connectivity as the relationship between living and technology becomes ever more intertwined.
How does JLL keep up with the digital transformation of estate agency?
AF: There are endless digital opportunities in estate agency, we work hard to find those that will provide a positive impact for JLL customers. We are reinventing how we do business today while exploring how our business will look in the future.
We focus on platforms, data and partnerships that allow a flexible and agile approach. We have recently created ResiForce, a new JLL SalesForce backed CRM system for our new homes business that provides real-time reporting, improved data management and interconnectivity with our clients. In addition, we work closely with our global investment fund JLL Spark to identify businesses to partner with and share growth opportunities.
Are Online Estate Agents a genuine risk to traditional agents?
AF: Online estate agents are welcome competition. Many industries have moved online to improve customer service and online agents have capitalized on this and created impressive growth. They do pose a risk, but only for agents that don’t embrace digital change. Many agents are using a hybrid model where customers are not required to enter a branch while still servicing more traditional requirements. Customers ultimately are price sensitive and until the new online agents are profitable and their model is proven, JLL are well positioned to adapt to the changing market.
Do you have any advice for a first-time buyer, trying to get on the property ladder in London?
AF: There are two main Government support products for first time buyers – Help to Buy and Shared Ownership. Both of these products have their advantages and disadvantages and we would always encourage aspiring buyers to do their homework before using. Another option for aspiring purchasers is to consider emerging regeneration areas which are typically at a lower entry price point but would be expected to grow strongly over the long term. We would encourage those interested in pursuing this route to explore the regeneration area they are interested in to get a ‘feel’ for the location and check it meets their longer term housing needs.
Finally, for a long weekend away, where would you go?
AF: Lisbon. I have only ever visited on business and would love to have more time there.
If you’re thinking about selling or buying a property, it is crucial you have the right estate agent giving you advice. They will be able to advise you on the market trends for your area and best times to sell your property. Helmsmen can help you find the best local estate agent to ensure you get the most from your purchase or sale. Try it now for free.