MHHG estate agents

Market Overview: The UK property market has experienced a robust performance throughout 2024, with key indicators surpassing those of 2023. Economic growth and rising consumer confidence have driven this momentum, leading to a significant increase in buyer demand, which is now 20% higher than at the same time last year. This surge in activity has been supported by more favorable mortgage rates, which have fallen to an average of 4.5% for a 5-year fixed rate at 75% loan-to-value (LTV).

Sellers are also actively participating in the market, bringing properties to market at an above-average rate. This is largely due to many sellers being buyers themselves, creating a cyclical boost in sales activity. Consequently, the number of new sales agreed is up by nearly 23%, reflecting a healthy and dynamic market environment.

Supply and Pricing Trends: The stock of homes available for sale has reached a 7-year high, with an average of 33 homes per estate agent. This increase in supply offers buyers greater choice, which is expected to keep headline price inflation in check through the remainder of 2024 and into 2025. For sellers, this means that pricing their homes realistically is crucial to securing a sale within a reasonable timeframe.

Interestingly, despite a cut in the base rate in August, there has been no significant shift in buyer demand beyond the existing trends. However, the base rate cut did prompt a modest increase in new sales, as some buyers were waiting for this adjustment before making a purchase.

House Price Inflation: House prices across the UK have seen a modest increase, with a 1.4% rise in the first seven months of 2024. This is a positive development, particularly after the price falls observed in late 2023 due to higher mortgage rates. The annual rate of inflation stands at +0.5%, reflecting the market's recovery from the previous downturn.

Regional variations persist, with Northern Ireland experiencing the highest annual price inflation at +5.1%, while areas like the Eastern region have seen a slight decline of -0.9%. In London, prices have turned positive, though only marginally at +0.2%. Some local areas, such as Taunton and Dartford, continue to experience small price falls, highlighting the ongoing adjustment to higher borrowing costs.

Buyer Sensitivity and Price Adjustments: As the market remains price-sensitive, particularly due to the impact of higher mortgage rates, sellers must remain realistic with their pricing strategies. In August, 20% of homes listed for sale had an asking price reduction of 5% or more. Homes with such price cuts are taking more than twice as long to sell compared to those without reductions, underscoring the importance of accurate pricing from the outset.

Outlook for the Remainder of 2024: The UK housing market is now more balanced than it has been in the past five years. The combination of lower mortgage rates and an improving economic outlook has attracted more sellers and buyers into the market, supporting sales volumes and stabilizing business plans for builders, estate agents, and lenders. Looking ahead, mortgage rates are expected to remain above 4%, which should continue to support home moves and sales. Additionally, healthy growth in household incomes will be crucial for sustaining the overall health of the housing market into 2025.

Manchester Market Insights: As a Manchester-based estate agent, we have observed that the local market is reflecting the broader national trends, with strong buyer demand and increasing sales activity. Manchester, known for its dynamic economy and vibrant culture, continues to attract both buyers and investors. The city's property market remains resilient, supported by its diverse housing stock and the growing appeal of its neighborhoods. Whether you're looking to buy, sell, or invest in Manchester, the current market conditions offer a range of opportunities, especially as more properties are coming onto the market, providing buyers with greater choice.