0:04 AM, 14th January 2025, About 15 hours ago
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Half of the UK’s 30 million homes increased in value in 2024 as house prices returned to growth following a decline in 2023, research from Zoopla reveals.
It points to weak buyer demand, driven by higher borrowing costs as contributing to the 2023 price drop.
A total of 15 million UK homes saw a value increase of 1% or more last year, a 42% rise from the 10.6 million homes that experienced price growth in 2023.
The average increase for homes with rising prices was £7,600, with 6.9 million homes recording a price increase of £10,000 or more. A third of the UK’s homes fell in value.
The platform’s executive director, Richard Donnell, said: “The housing market returned to growth in 2024 but the pattern of home value changes across Britain is far from uniform.
“There is headroom for prices to increase in markets where housing is affordable compared to incomes which covers many parts of northern England and Scotland.
“In contrast, affordability is more of a constraint on price rises in Southern England where the market continues to adjust to higher borrowing costs.”
He added: “Faster income growth is helping to repair affordability supporting moving decisions in 2025.”
Zoopla says that while 2024 saw a broad recovery in house prices, a third (9.2 million homes) still recorded a price decline of 1% or more.
However, this figure is lower than the 12.8 million homes that experienced a price drop in 2023.
Around six million homes saw minimal price changes over the year, fluctuating within a 1% range.
There’s also a significant north-south divide which persisted in 2024, with fewer homes in Southern England recording price rises compared to the rest of Britain.
This disparity reflects the underlying affordability of homes and the impact of higher mortgage rates in areas with above-average home values.
Mr Donnell said: “Every home has its own trajectory for price changes and millions of owners are tracking the value of their home on Zoopla as part of the decision of when to move home.
“The momentum from 2024 is spilling into 2025 with a seven-year high number of homes for sale.”
He adds: “We expect more people to move home in 2025 than in 2024 despite uncertainty over the economic outlook and broadly static mortgage rates.”
Only 36% of homes in southern England increased in value by 1% or more, with 41% of homes experiencing price drops, averaging £8,700.
This contrasts sharply with the northern regions of England and Scotland, where 63% of homes registered gains in 2024.
Coastal towns in Kent and East Sussex were least likely to register price rises last year.
Many towns saw less than 10% of homes rising in value, while more than three-quarters of homes recorded minor price falls.
This trend can be attributed to the waning of the pandemic boom, the subsequent return of more workers to offices, and more second homeowners selling in response to a doubling of council tax from April.
This sell-up has also impacted prices across many coastal towns, Zoopla says.
The president of NAEA Propertymark, Toby Leek, said: “It’s a positive sign that increases in house prices are being seen as this shows confidence and affordability improving for buyers and sellers in the market.
“Not only will many homeowners be happy to see that their home may potentially have increased in value, but our latest member agent data also shows the overall number of properties achieving asking price has nearly doubled month on month meaning moving home and receiving the price expected is becoming easier.”
Tom Bill, the head of UK residential research at Knight Frank, said: “A slowdown in house price growth is in the post.
“As sub-4% mortgage offers dry up and stamp duty rates increase in April, rising borrowing costs will suppress demand more noticeably from the second quarter of this year.
“As demand spreads into more affordable parts of the country, prices in these locations will remain relatively more buoyant.”
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