How stable is the housing market heading into 2019? According to residential property experts at Knight Frank, despite the uncertainties caused by Brexit, on balance it’s looking positive.
Analysts carried out an extensive survey with housebuilders and developers in the UK to understand their views on how housing will progress in 2019, and the response was confident.
Survey respondents felt it would be realistic to assume 200,000-250,000 homes built this year. Although the figures are below the Government’s target of 300,000, the housebuilding industry has increased output by 55% over last five years and for 2019, 92% of volume housebuilders who responded to the Knight Frank survey said they intended to ramp up construction starts.
The Office for Budget Responsibility (OBR) forecasts net additional dwellings will plateau to around 240,000 between 2020 and 2023, which does back up the figures stated by the housebuilders and gives some degree of reassurance for the next few years.
The NHBC reported continued growth during the last quarter of 2018, with more than 15,000 new homes registered. The areas which saw the most homes registered were:
– Yorkshire and Humberside – up by 43%
– Wales – up by 34%
– South West – up by 21%.
Overall, nine out of the 12 UK regions saw an increase in new home registrations and it looks like this trend is set to continue. NHBC says that, over the next three years, Outer London, the South East and the West Midlands will provide the best opportunities for UK housebuilders due to strong demand in these areas.
As for the Irish housing market, the picture also looks encouraging. The Irish population is predicted to grow by 3.8%, the economy is predicted to grow by 4.1% in 2019 and the pace of new home starts is growing at a steady rate too (although, just like in the UK, demand still far outstrips supply).
First time buyers and the Help to Buy scheme are driving demand for smaller, affordable homes and this has kept new build prices consistent. Regional cities such as Galway, Limerick and Cork are seeing new schemes being released, so it’s not just Dublin that is seeing the benefit of housing growth.
If you’re interested in tracking this part of the market, do remember that the TRA provides members with access to the excellent economic forecasts from the Construction Products Association. You can also find useful analysis in the Housing Market Intelligence reports published by Housebuilder magazine.