Housing market is showing signs of recovery as prices and sales edge up

Housing market is showing signs of recovery as prices and sales edge up

0:05 AM, 19th February 2024, About 4 months ago

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The UK’s housing market is showing signs of recovery, with prices rising slightly and sales surging, according to a report by Rightmove.

The property website said that the average asking price for a new seller increased by 0.9% (+£3,091) this month to £362,839, reversing the downward trend of the previous six months.

Compared to a year ago, prices are up by 0.1%, marking the first annual increase since July 2023.

‘February would be an important indicator’

Rightmove’s director of property science, Tim Bannister, said: “We said that February would be an important indicator for the year ahead, and the question was whether the Rightmove Boxing Day bounce in buyer activity would keep its spring into March or lose momentum.

“It’s proved to be the former, with the number of sales agreed continuing to considerably outstrip last year.

“Mortgage rates have fallen considerably from their peak and are now remaining broadly stable after the uncertainty of late 2022 and 2023.”

He added: “Momentum to move in 2024 is continuing to build, but prospective sellers mustn’t get carried away.”

Agreed sales in the first six weeks of 2024

The report also revealed that the number of agreed sales in the first six weeks of 2024 was 16% higher than the same period in 2023, and 3% higher than in 2019, before the pandemic hit.

This suggests that many buyers are keen to take advantage of the favourable market conditions in 2024, such as low interest rates, stamp duty relief, and pent-up demand.

Rightmove said that the market momentum was reflected in the growing activity of both buyers and sellers on its website, with 7% more new listings coming to market than last year, and a 7% increase in the number of buyers enquiring.

The market is price-sensitive

However, the report also warned that the market is price-sensitive, and that there was a clear divide between properties that were priced realistically and those that were over-priced.

The former were selling quickly, while the latter were languishing on the market.

The average time to find a buyer was 67 days, 16 days longer than at this time last year, and the slowest since 2015, excluding the initial pandemic lockdown months of April and May 2020.

Rightmove said that its analysis shows that sellers who priced right initially were far more likely to sell quickly and advised sellers to do their research and listen to their agents’ advice.

‘A more stable housing market’

Mr Bannister said: “There continue to be reasons for cautious optimism as we settle into 2024, with encouraging activity levels and a more stable housing market.

“While some would-be buyers will continue to be affected by elevated mortgage rates and major affordability constraints, many other prospective buyers who can afford to do so, have acted fast and demonstrated their belief that 2024 is their year to get moving.

“It is still early days for 2024, with a Budget, General Election and no doubt more global events still to play out.

“Rightmove’s whole-of-market data shows that it’s the first-time buyer segment who could use the most support this spring, and well-thought-out initiatives to help to get more would-be first-time buyers onto the ladder would be welcome.”

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