UK Housing Market Gains Momentum

May 8, 2024

The UK housing market is showing resilience as we progress into the middle of the year, with indicators such as rising numbers of prospective buyers and increased viewings per property. Propertymark's latest Housing Insight Report reveals a 4% uptick in prospective buyers registered at member estate agencies, reflecting sustained activity in the UK housing market.

Accompanying this trend is a marginal increase in house prices, with Propertymark's data showing a rise of £1,216, bringing the average sold price in February 2024 to £280,660. Notably, this increase is driven by price rises in Scotland and Northern Ireland, surpassing the rest of the UK.

On average, each estate agency branch now registers nearly 80 buyers, a notable increase from previous months and a stark contrast to December 2023's figure of less than 40 buyers per branch. Moreover, buyers are actively pursuing property viewings, with each property receiving around 3.5 viewings in March, reflecting a seasonal uptick.

Despite economic challenges and political uncertainties, the housing market remains stable, with patterns closely mirroring last year's figures, indicating sustained demand.

Improving affordability may be contributing to increased buyer interest, with Propertymark's analysis showing a decrease in the number of adults finding it difficult to afford mortgage or rent payments. This positive trend contrasts with fluctuating affordability challenges seen in recent months, with the current figure around 35%, lower than its peak in June/July 2023.

Stability in house prices may persist due to a slight decrease in new housing supply, despite a previous uptrend since December 2023. Propertymark reports an average of 10 new homes per member branch listed for sale in March 2024, a marginal decrease from February's figures.

While the number of sales agreed remains relatively static compared to last year, there is a noticeable gap between asking and sale prices, albeit slightly narrowing.

Looking ahead, a more positive economic outlook emerges, with expectations of potential interest rate reductions as inflation decreases. Inflation has indeed shown a decline, with the latest CPI figures at 3.2%, significantly lower than the previous year. Additionally, GDP growth of an estimated 0.1% in February signals positive momentum for the economy and consequently, the housing market.

Nathan Emerson, CEO of Propertymark, remains optimistic, anticipating further improvements in inflation and potential interest rate adjustments. With increased demand in the residential sales sector and stable supply levels, the UK housing market navigates through uncertainties with resilience and cautious optimism.