Zoopla’s latest house price index reveals a cautious yet promising outlook for the UK property market, with buyer demand up 20% over the past year and house prices showing a modest increase. However, experts warn that sellers must remain realistic in their pricing to avoid delays and disappointment.
According to Zoopla, the average house price has increased by 0.5% over the last year and by 1.4% in the first seven months of 2024. The market is on track for a 2.5% rise by the end of the year. With properties for sale reaching a seven-year high—averaging 33 homes per estate agent—competition among sellers is fierce.
Sarah Coles, Head of Personal Finance at Hargreaves Lansdown, cautioned against over-optimism: “Sellers can’t afford to get carried away. Buyers are back, with demand up a fifth in a year, but sellers who get cocky, and price their home too optimistically, will pay a horrible price for their over-confidence.”
The risks of overpricing
Coles highlights the pitfalls of overpricing, noting that properties requiring a price reduction take more than twice as long to sell—73 days compared to just 28 days for those correctly priced from the outset. “Anything that’s too expensive will be kicked to the kerb,” Coles explained. “Because you’ve lost the initial interest in your home, you may end up having to cut it more than if you’d been realistic at the outset.”
Despite the promising rise in house prices and buyer demand, Coles emphasises the need for sellers to do their homework and set realistic prices. She also advises sellers to prepare thoroughly, ensuring their home, paperwork, and finances are in order to act swiftly when the opportunity arises.
Market resilience and future expectations
Daniel Austin, CEO and co-founder of ASK Partners, shared an optimistic view on the market’s resilience, even in the face of political events like general elections. He noted, “The property market is not traditionally affected by general elections, but it is positive to see that the recent election has not had a negative impact. The market certainly appears to be showing signs of resilience.”
Austin also pointed out the sustained growth in rent values, positioning real estate as a solid investment compared to gilts. He anticipates that initiatives from the new government will further bolster the market, particularly in terms of driving construction and unlocking the planning system.
The role of strategic investments
In the realm of commercial real estate, Austin observed a rebound in confidence, with opportunistic acquisitions of prime properties in key locations. “As a debt provider, we hope to support well-capitalised borrowers who understand their product and are looking at the best sites in prime locations with potential to add to their asset value,” Austin added.
As the market continues to evolve, both Coles and Austin underscore the importance of strategic planning and realistic pricing in navigating the current landscape. The signs of recovery are there, but careful, informed decisions will be key to capitalising on the opportunities ahead.
