Anticipating UK Housing Market Trends in 2024

Anticipating UK Housing Market Trends in 2024

Despite facing challenges, the UK's real estate sector is showing signs of improvement, with increased interest from prospective home buyers and sellers. Recent studies suggest growing confidence in future property prices, following a decrease in mortgage rates from a 15-year high. However, there is a potential for a dip in house prices in 2024. Two key property price indices, Zoopla and Halifax, are examined to assess the sustainability of the positive trend in 2024.

Halifax reports an average UK house price of £291,029 in January, marking a 1.3% rise from December 2023, the fourth consecutive month of price increases. The annual growth rate stands at 2.5%, the highest since the previous January. Factors contributing to buyer and seller confidence include falling mortgage rates, decreasing inflation, and a robust labour market, setting a positive tone for the 2024 housing market.

Zoopla, on the other hand, reports an unchanged average house price of £264,400 in December 2023, reflecting a -0.8% adjustment from the previous year. House prices seem to be adjusting to rising mortgage rates with modest declines, though at a slowing rate as 2024 begins. Regional variations show sharper price descents in the East of England and the South West, while Northern Ireland sees a 3.2% increase in house prices over 2023.

Despite a rise in buyer interest in 2024, it is essential to interpret this as a seasonal spike rather than a definitive trend for the entire year. Mortgage rates below 5% have contributed to a 12% increase in demand compared to the previous year, although it is still 13% less than the five-year average. The current mortgage rates are expected to influence sale transactions positively without severely impacting property prices.

Research by Rightmove suggests that February is the most beneficial month to put a house on the market, offering a higher chance of finding a buyer promptly. Properties listed in February take an average of 51 days to secure a buyer, with a success rate of 66.4%, the highest alongside April. This trend, coupled with increased buyer inquiries and new properties entering the market, indicates a favourable environment for those considering a sale at the beginning of spring in 2024.

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