2024 Property Market Forecast
The 2023 property market wasn’t short of challenges. The rising cost of living, compounded by increasing mortgage rates meant the market was considerably slower compared with the post-lockdown highs of 2022. That said, we saw a marked increase in property activity in the lead-up to Christmas. Far from a seasonal slowdown, there were more viewings in November and December than in September. With declining inflation and the likelihood of falling mortgage interest rates in 2024, we believe the market will continue to improve in the coming months. Indeed, in a recent poll of 41 economic experts by The Times, almost all said they anticipate two reductions in the Bank of England base rate. Nearly half of the experts predicted three or more cuts. Only two economists in the survey anticipate the Bank maintaining the base rate at its current level.
The Office for National Statistics (ONS) reported a 1.2% dip in house prices over the 12 months to October, following a decade of consistent growth. There was a 1.8% annual decrease in average property prices, according to the Nationwide House Price Index, yet the market has shown resilience amid external pressures and isn’t as drastic as some property buyers have hoped in their negotiations.
Optimistically, Go.Compare has indicated that if mortgage rates stay at an average of 5.3%, house prices could increase by 5.92% by September 2024, and if rates fall by a further 1% this number could double. They have caveated this, however, by saying a 1% increase to 6.3% could result in a 4.66% decrease in property values. Also, positively, Halifax reported a 0.5% monthly increase in property values in November, the second consecutive increase, which further indicates a potential market rebound. Looking ahead, we believe the property market’s outlook is positive and a potentially exciting period for potential homebuyers and investors.