The UK housing market is on the brink of change in 2024. The year is predicted to see a 2% dip in house prices. This decline comes from rising mortgage rates over the last 18 months, making housing less affordable for many.
As the number of homes for sale reaches a 5-year high, sellers must strategically price their properties to entice buyers. While modest, annual price falls are expected to expand, with some markets potentially seeing 5% decreases. However, the risk of a significant price collapse is diminishing.
- Housing Affordability: To revitalise the housing market, enhancing affordability is crucial. This involves boosting household incomes and reducing mortgage rates. As inflation-driven living costs ease, buyer demand is expected to increase.
- Market Recovery Prospects: Despite relatively high interest rates, they remain historically low. With mortgage rates in the 4-5% range, UK house price growth is anticipated to stay in the low single digits for 1-2 years, making properties more accessible and renewing consumer confidence.
- Resilience of House Prices: House prices have held steady due to a slowly growing economy, low unemployment, rising incomes, lender support through refinancing options and mortgage holidays, and stricter affordability criteria from lenders.
- Buyer Behavior in 2024: Anticipate a seasonal demand spike in spring, but overall sales in 2024 are expected to be lower than the previous year. General elections can introduce market uncertainty, leading to buyer hesitancy.
- Cash Buyer Dominance: In 2024, cash buyers are predicted to lead the market, followed by first-time buyers. Upsizers seeking more significant properties with bigger mortgages face challenges from higher mortgage rates. Encouraging flexibility in their choices could boost overall sales volumes.
In summary, the UK housing market 2024 is on the verge of change, with an expected 2% decrease in house prices. The key to market rejuvenation is improved affordability through rising incomes and decreasing mortgage rates. Staying informed about these developments is essential for decision-making in the year ahead.
Ready to navigate the changing landscape of the UK housing market? Contact our expert conveyancing team today to learn more.
Information gathered from Zoopla, see here.