Property Market Predictions for 2023
From a Property Market Expert
Well, that’s 1 month out of 12 completed for 2023…
Apart from being nearly killed in Marrakesh, I would say it’s been an eventful beginning to the year. Since the start of the year, I’ve been gathering some 2023 predictions for the property market from property market experts, directors and colleagues. I even asked ChatGPT what it thought would happen this year.
It is difficult to predict the exact future of the UK property market with certainty, but some factors that may impact the market in 2023 are:
Continued economic uncertainty due to Brexit and its aftermath
The recent dramatic Interest rate changes and their impact on mortgage affordability
Supply and demand dynamics in different regions
Government policies and regulations affecting the housing market, the changes to first time buyers help for example.
Given these factors, it is possible that the UK property market in 2023 may see some price growth, a stabilisation of the London rental market, and increase in transactions. But how likely is this?
Oxford Economics have predicted a price contraction in the market and whilst some of those I interviewed agree that it eon’t be an easy year, no one has been quite as pessimistic.
SAles
I asked a few of our estate agent clients what they expect the 2023 property market to look like and how they are planning to manage the turbulent times ahead.
Return to 2019
Nick Ferrier, director at Jackson-Stops said:
“I wouldn’t be surprised if the market remained relatively stable throughout the course of 2023. People will settle & I doubt there will be an abundance of stock in comparison to the last 2 years”.
With the last 3 being so chaotic it’s understandable that we are comparing ‘normal’ to 2019 rather than the previous year. A couple of our clients believe that 2023 will have a very similar picture to what we saw in 2019.
So what did the property market look like prior to Covid and exponential the mortgage rate rises? The 2019 property market was characterised by:
Slow price growth, with average house prices rising only slightly.
A stable rental market, with modest rent increases.
Brexit uncertainty did affect buyer sentiment, leading to a slowdown in transaction volumes.
Regional disparities, with some areas experiencing more robust price growth than others.
Jo Wolley, the marketing manager at Jones Robinson agreed with this notion that 2023 will be steady, similar to 2019
“There was very little growth in 2019, I would expect to see no market growth this year”.
Luke & Paul, marketing manager & director at Arun Estates Group added that
“The market undoubtedly will correct itself back to the house prices and translation levels we saw in 2019”.
This idea was cemented with an article from Housing Today:
“Ratings agency S&P Global has predicted UK prices will go down 3.5% in 2023, which is the steepest drop in Western Europe after Portugal, where the fall is expected to be 4.4%.”
Finding New Buyers
Mark Bridge, owner of Mark Antony Estates in Warrington suggested that listing houses shouldn’t be an issue for estate agents [in Warrington], but they undoubtedly will see fewer completions, with sellers being unable to find onward purchases.
I spoke to Mark a few weeks ago, he mentioned they will be implementing a new service which puts greater emphasis on helping sellers find an onward purchase.
It may seem obvious for an agent to offer this service, but as a marketing tactic, I think this will boost confidence amongst sellers and keep the market rolling.
Location
Location & geography will play a big part in the success of agents in 2023. Wendy Worger, the marketing manager at The Property Centre based in Cheltenham added that areas with more financial stability are less likely to be affected;
“It’s going to be a tough 2023 for the market as a whole. I think TPC [The Property Centre] shouldn’t be affected too much due to the affluent area they operate in”.
Excluding London and its skewed price structure, the south (the home counties & south west) and a few areas in the north west tend to be the areas in England with the highest property prices.
These locations & geographies will be largely unaffected this year. However, they are also unlikely to see the type of growth from the previous 2 years so it’s not all good but things could also be worse.
Auctions
Okay so that’s traditional sales - I also wanted to find out about house auctions & whether Doug & Alex, owners of Whoobid, would feel the market slowing up.
Doug said
“Well, the prices of homes in the last 18 months have gone up by 20%... so naturally a market correction was imminent. With house prices now on the slight decline in 2023, we think that home auctions will gain even more popularity. So we are in pretty good shape for this year, even though economic conditions suggest a downtrend in the market”.
So maybe the risk of letting your house go to auction might be the way forward, to help avoid those losses of the downturned market.
LETTINGS:
Okay, that’s the sales market. How about lettings? I spoke to Bradley Rennie, marketing manager for the Bristol letting agent, The Letting Game about his predictions in 2023
“2023 will be stable for the lettings industry. Probably a steady increase in rental prices. I think there will be a lot more DIY landlords in the market.”
With the prop tech market ever growing, it’s easier than ever to become your own DIY landlord, having more control over your property with tools to help with every aspect of the rental process.
Finally, let’s ask AI celebrity of the moment, ChatGPT what factors the property rental market will be influenced by this year:
Economic conditions and job market stability
Availability of rental properties and supply-demand dynamics
Changes in government policies and regulations affecting the rental market
Interest rate changes and their impact on rental affordability
Given these factors, it is possible that the UK rental market in 2023 may see:
Stable rental prices, with modest rent increases in some areas and slight decreases in others
Continued demand for rental properties, particularly in urban areas with strong job markets
Increased competition for rental properties in areas with tight supply and high demand
So, Will the property market crash in 2023?
It's impossible to say for certain, but it does seem that if things continue on the same path, it's a possibility. I believe that the property market will be on the rise again in the near future, but agencies must still look and plan ahead.
In my opinion, it’s only a matter of time until the housing market corrects itself. The notion of price correction is seen across the stock market. From crypto assets, S&P 500 indexes & the housing market. An inevitable step, in order to see the market to gain momentum and continue to grow from 2024 onwards.
Now more than ever, marketing your agency is so important, ensuring you stay front of mind and highlighting to those people who are looking to sell or let their house that your agency will find them the best price for their home. Whether that means ramping up your search ads, retargeting website viewers on social media or even a full scale website/ SEO audit.
