MHHG estate agents

A Strong Year for Sales Activity

2024 has marked a significant year for housing sales in the UK, primarily driven by intensified competition among lenders, which has resulted in mortgage rates reaching their lowest point in two years. Coupled with rising household incomes, this has fueled high levels of new sales, reminiscent of the sales surge post-pandemic in late 2020. Despite this heightened activity, house price inflation remains moderate, with an annual increase of just 1% up to September 2024.

The price stability is partly due to an ample supply of properties on the market, which has helped keep price inflation under control amidst continued affordability challenges. Regionally, price growth varies: the North East, North West, and Scotland are seeing slightly higher increases (2% to 2.4%), while regions like the South East and East have experienced slight declines in prices.

Largest Sales Pipeline Since 2020

A consistent rise in new sales has created the largest sales pipeline in four years, with around 306,000 properties now under contract. This represents a 26% increase from last year, signaling sustained demand as buyers and sellers alike regain confidence in the market. The total value of homes in the sales pipeline has reached an impressive £113 billion—up 30% compared to last year—following last year’s slowdown due to elevated mortgage rates.

First-Time Buyers Lead the Market

In 2024, first-time buyers (FTBs) represent the largest buyer group, accounting for 36% of all property sales. This cohort has been encouraged by lower borrowing costs, which make buying a property more cost-effective than renting for many. With mortgage payments now averaging 17% lower than rent for a typical first-time buyer home, more renters are making the leap to homeownership. In addition, an uptick in landlord sales has provided more affordable housing options for FTBs. Notably, 12% of listed properties were previously rentals, with an average asking price of £307,000—16% below the UK average.

Manchester Property Market in Focus

As a Manchester-based real estate agency, we’ve observed similar trends locally. House price growth in Manchester aligns with the moderate increases seen in other northern regions, supported by relatively affordable housing compared to the South. With an increase in FTBs and increased mortgage affordability, the city’s property market remains robust. However, with Manchester’s appeal and ongoing urban development, particularly around hotspots like the Etihad Football Stadium and Co-op Live Arena, demand remains high, and we expect steady growth in the housing sector.

Outlook for 2025 and Potential Policy Impacts

Looking ahead, the market is poised to see continued activity, driven by stable mortgage rates in the 4%-4.5% range. Wage growth will play a pivotal role in maintaining affordability. Price inflation is anticipated to remain modest, with a projected 2% increase for 2024. However, potential changes to stamp duty relief could impact first-time buyers, particularly in areas like London and the South East. In the north, including Manchester, the stamp duty effect may be more muted, but FTBs across the UK could feel the pinch if relief thresholds revert to previous levels in April 2025.