The most recent housing data from the Land Registry and HMRC reveals a resilient market, even amidst rising interest rates.
Residential property transactions in April saw 79,590 homes sell, a 17.3 per cent uptick on April 2023’s figures.
Although there was a small decline from March, this signals activity 113.1 per cent higher than the Covid-impacted trough in April 2020.
Ben Powell, partner at Ballards LLP, said: “Clearly, buyer demand remains robust despite the run-up in mortgage costs over the past year.”
The Bank of England has maintained its base rate at 5.25 per cent, a full percentage point greater than last year.
However, potential homeowners are eager to take advantage of the current moderate price growth before potential interest rate reduction emerges later in 2024.
As for house prices, the Land Registry reports the average UK home’s price was £282,776 in March, 1.8 per cent higher year-on-year.
Despite a 12.1 per cent rise from the low of 2021 at the height of the pandemic, the monthly increase of just 0.75 per cent from February suggests price growth is easing slightly.
The forthcoming general election seems unlikely to impact housing market activity, if past experience is any guide.
“But buyers will be keeping a close watch on the mortgage market’s response if interest rates are indeed cut later this year, as this could provide much-needed relief on affordability,” said Mr Powell.
He further highlighted the improved choice for buyers, saying: “The improved inventory levels we’re seeing provides today’s buyers with more options and bargaining power versus the stock shortages of prior years.”
In terms of regional transactions, England led with 81.2 per cent of April’s sales.
Looking ahead, experts widely predict that the Bank of England may begin cutting interest rates in the second half of 2024 if inflation continues moderating.
Mr Powell added: “For now, the data depicts a housing market showing resilience and continued appetite from buyers, even amid the affordability constraints created by costlier borrowing over the past year.”
He finished by saying: “Resilience will remain key as we progress through 2024.”
