The UK’s housing market has shown early signs of recovery in January, with a mixture of falling and rising house prices across the nation, alongside an increase in rental costs. According to the Office for National Statistics, the average house price fell by 0.6% year-on-year but saw a month-on-month increase of 1.1% on a seasonally adjusted basis. The average house price now stands at £282,000, highlighting the dynamic nature of the property market as it begins to stabilise.
A Positive Outlook Despite Challenges
Sarah Coles, head of personal finance at Hargreaves Lansdown, provided an optimistic view of the property market’s direction. “This is a very early glimpse of the January joy, which suffused the property market at the start of 2024, and encouraged a decent chunk of buyers and sellers to rejoin the property party,” she commented. Coles also pointed out that the lag in property figures, reflecting sales agreed since about October, should soon present an even more positive outlook as mortgage rates have been on a declining trend.
Spring: A Season of Renewal for the Housing Market
Nathan Emerson, CEO of Propertymark, echoed the sentiment of an improving market, particularly with the advent of spring, traditionally a busy period for housing transactions. “This is an ideal time for buyers to start looking for homes that they can afford,” Emerson stated, highlighting an 80% increase in new properties coming to the market according to Propertymark’s Housing Insight Report.
Market Sentiment Remains Strong Despite Absence of New Initiatives
Ruth Beeton, co-founder of Home Sale Pack, and Jason Harris-Cohen, CEO of Open Property Group, both remarked on the market’s resilience and recovery. Despite the absence of new homebuyer initiatives in the Spring Budget, Beeton noted that homebuyers are keen to proceed with their purchasing plans. Harris-Cohen added that the sold price figures for early 2024 indicate a market gaining strength on several fronts, with a positive outlook for the year ahead.
London’s Market and the Anticipation of Mortgage Rate Reductions
The London housing market, in particular, has shown a notable increase, with property values rising by 2.5% on a monthly basis. Marc von Grundherr, Director of Benham and Reeves, and Verona Frankish, CEO of Yopa, both highlighted the capital’s recovery and the potential impact of anticipated mortgage rate reductions. Frankish pointed out that the market is eagerly awaiting the Bank of England’s decision, with hopes for a base rate cut that could further stabilise the UK property market and boost buyer sentiment.
As the property market navigates through uncertain times, the early signs of recovery offer a glimmer of hope for both buyers and sellers. With mortgage rates potentially decreasing and a robust level of transactions already taking place, the outlook in 2024 remains cautiously optimistic.
