A CONFIDENT START TO THE YEAR
Published 18 January 2020
We have dusted off the crystal ball and taken a look at what the new year is going to bring for the residential property market in Norfolk.
Just over a month ago, we were still in the throws of a General Election campaign, the culmination of a year of political uncertainty which had a big impact on the economy as a whole, and inevitably on the housing market as well. Property is so much about confidence, and anything which dents that will have a negative effect on the market.
So whatever your political views, there can be little doubt that the decisive result in the election will lead to an easing of the political logjam which characterised 2019. Already we are seeing a rise in general confidence, which in turn is leading to a willingness to make some decisions about the future.
In Norfolk, we have record levels of employment, and with interest rates not predicted to change much over the next 12 months, it all bodes well for a stable market in 2020, which is exactly what we need.
It isn’t that the demand for houses isn’t out there – the past two years has seen an insatiable clamour from buyers. The thing that has held the market back has been the unwillingness of nervous sellers to put their homes on the market and consider moving but this inertia is definitely on the way out.
The main consequence of this will be a rise in supply and hence an increase in activity in the market – in other words more transactions. I can’t see prices moving that much at all, perhaps by up to three per cent across the year. This is no bad thing; a stable market is exactly what we need to boost and maintain confidence levels.
Here in the north of the county, the market is also being boosted by consistently high demand for holiday homes, much of this as a result of a vastly increased appetite for ‘staycations’, driven by uncertainty about our relationship with Europe and a continually weak pound.
Given the lack of supply of such homes in the traditional hotspots of north Norfolk (Blakeney, Brancaster, and so on), we are seeing a big spike in the market further round the coast, with Mundesley, Sea Palling and Waxham all becoming hotspots. Prices are strong here, and properties are selling quickly; this demand is unlikely to abate during 2020.
One note of caution in all this, though: confidence is a fragile and fickle thing, and can easily be knocked by any suggestion of uncertainty. The new government came in promising to get on with Brexit, but despite the fact we will officially leave the EU on 31 January, there is much still to do to avoid a cliff edge at the end of 2020. Any hint of failure to achieve a deal by that date, with the risk of employers further delaying investment, could damage the economy and knock back confidence levels. Never before has it been so important for politicians to keep their pre-Election promises.
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