These latest indices are super-useful to everyone in the property market. The reason being is they clearly show that all the predictions of the property market crashing in 2023 were, basically, very wrong!
It’s great data to put out in a blog to consumers or on instructions to show them that the news headlines about crashes or booms really aren’t much use to them.
In a recent interview with BBC Radio Nottingham, I gave examples of properties that had gone up, down and stayed the same, going right back to the last recession in 2007/8. The individual sold property price data we have access to is really useful to show buyers and sellers that the main people they should talk to to find out what’s happening property wise is: their local agent.
Property price and market indices headlines
Tentatively promising new year start as buyer and seller activity jump
“Average new seller asking prices rise by 1.3% month-on-month to £359,748, the biggest December to January increase in prices since 2020, though average prices are still 0.7% lower than at this time last year.”
Prices hold firm on rate cut optimism and falling stock
“Asking prices remain unchanged since last month across England and Wales but are down year-on-year by just 0.5% vs. Jan 2023.”
Outlook for sales market activity continues to improve gradually
“House price declines continue to moderate at the national level, with respondents now anticipating a flat trend over the year ahead.”
House prices begin 2024 on a more upbeat note
“UK house prices rose by 0.7% in January, after taking account of seasonal effects. This resulted in an improvement in the annual rate of house price growth from -1.8% in December to -0.2% in January, the strongest outturn since January 2023.”
Positive start to 2024 for UK house prices
“Average house prices rose by +1.3% in January, the fourth monthly rise in a row.”
Annual prices still falling in January
“House prices in England and Wales saw a slight increase this month, rising by £620 (0.2%) to reach a level last seen in February 2022. This marks only the second time in the past 15 months that prices have grown by more than 0.1%.”
“Our UK house price index recorded annual price falls of -0.8% in December 2023, up from a -1.4% low in October 2023.”
In the meantime, the best information and analysis from this month’s property indices is that demand, instructions and indeed sales agreed appear to be better than they were versus last year, which is a great start to 2024.
And, hopefully this should continue with lenders competing mortgage rates down to sub 5%, although Zoopla’s conclusion is that it’s “Important not to over-interpret the positive start to the year – there is some upside for sales volumes, but we remain in a buyers’ market.”
- The number of new properties coming onto the market for sale is 15% higher than in the same period last year.
- Buyer demand in the first week of 2024 is also 5% higher than in the same period last year. However, competitive pricing from sellers is still vital, with the number of new properties coming to market outpacing the rise in demand.
- The number of sales agreed is 20% higher than during the first week of last year, indicating a strong return of buyer confidence when compared with the unsettled post-mini-Budget period a year ago.
- The average 5-year mortgage rate is now 4.86%, compared to 6.11% at the July 2023 peak. While there may be more surprises to come, early indicators suggest a more stable year for the mortgage market after its volatility from September 2022 onwards.
- UK house prices rose 0.7% month on month in January.
- There have been some encouraging signs for potential buyers recently with mortgage rates continuing to trend down.
“If average mortgage rates were to trend down to 4%, this would ease the mortgage payments burden to 34% of take-home pay (assuming house prices and earnings are unchanged). However, other things equal, mortgage rates of 3% (still well above the lows seen in the wake of the pandemic) would be needed to bring this measure of affordability back towards its long run average.”
- The average house price in January was £291,029, up +1.3% or, in cash terms, £3,924 compared to December 2023.
- This is the fourth consecutive month that house prices have risen and, as a result, the pace of annual growth is now +2.5%, the highest rate since January last year.
- Northern Ireland recorded the strongest growth across all the nations or regions within the UK.
- South East England continues to see most downward pressure on house prices.
- The total sales stock count for England and Wales has fallen again. The current total of unsold property is 423,827, around 15,000 less than last month and typical for the time of year.
- The number of new instructions entering the market in December 2023 was only 3% more than during December 2022. This is a remarkably small increase given the market chaos caused by the doomed Truss-Kwarteng mini-budget, which led to a shock drop in prices of 2.4% in just one month.
- The Typical Time on Market for unsold property in England and Wales rose by twelve days during December, again in line with seasonal expectations. The current median is 112 days; in pre-COVID January 2020, the same measure was 120 days.
- Monthly prices are now showing a small increase.
- North East continues as the only region with price gains over the year.
- Transactions remain at lowest levels of last seventeen years.
- Demand up 12% year-on-year, led by London and East of England.
- Sales agreed up 13% year on year – sales up across all regions.
- Available homes for sale over 20% higher than a year ago.
- A fifth of sellers having to accept more than 10% below the asking price to secure a sale, closer to 1 in 4 across southern England.
