0:08 AM, 19th February 2024, About 10 months ago
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Lower mortgage rates and a backlog of demand from the last six months of 2023, which has continued into February, has seen the UK’s housing market begin the year with strong momentum, Zoopla reveals.
The property platform says there is 11% more buyer demand than the same period last year.
Also, those buyers are active in all regions of the UK, but London leads the way, followed by the North East and North West.
London’s housing market has been underperforming compared to the rest of the UK since 2016, with weak house price growth due to high housing costs.
Zoopla’s executive director of research, Richard Donnell, said: “The average value of a flat is just 13% higher than in 2016, compared to the average house price being 33% higher and up to 50% higher in Wales.
“Better value for money is improving the prospects for London but it remains an expensive housing market.”
He added: “One of the best ways to assess the overall health of the housing market is to look at the trends in the number of sales being agreed.
“If buyers and sellers are agreeing more sales then that shows a healthier market, with people able to fulfil their home moving ambitions.”
With nearly 20% more homes on the market than last year, buyers have more options and a better chance of finding their dream home.
The data reveals that sales are rising in every region, with six regions seeing a surge of more than 10%, led by London, the South East and Yorkshire and Humber.
As the market confidence improves, more sellers are joining the fray and there are more new homes being put up for sale.
In 2023, it took an average of 34 days for a home to go from being listed to being sold, subject to contract.
This is two weeks more than the heated market of 2022, when homes were snapped up in 20 days.
Mr Donnell said: “Pitching the asking price at the right level is key to attracting demand and getting a sale agreed. This can be harder for unique or unusual homes.
“The longest sales periods in 2023 were up to 40 days in London and the South East with the fastest sales periods in Scotland (20 days) and the North East (30 days).”
He adds: “This difference primarily reflects housing affordability and the impact of higher mortgage rates on buying power in markets with high house prices.
“It’s why falling mortgage rates are boosting activity more in southern England, especially London.”
Matt Thompson, Chestertons’ head of sales, said: “The current boost in buyer activity is exactly what many sellers have been waiting for.
“Buyers have become increasingly confident since December, when interest rates were held at 5.25% and mortgage rates started to come down.
“This sentiment carried through to January and with more properties now on the market, we expect to see increasing numbers of buyers, additionally driven by pent-up demand from those that did not feel comfortable moving forward with their search last year.”
He added: “We are seeing all types of buyers now entering the market, including first-time buyers, young couples joining forces to achieve a joint upgrade and people that live outside of the capital and require a pied-à-terre to avoid lengthy daily commutes.”
