ANTICIPATING A POSITIVE FUTURE FOR THE HOUSING MARKET IN 2024
Monday December 11, 2023
The resilience and unexpected buoyancy of the housing market throughout the current year have exceeded initial predictions, leaving many optimistic about what lies ahead in 2024. Despite concerns surrounding rising mortgage and interest rates impacting affordability, the market has showcased robust performance, with lower-than-expected declines in asking prices and a consistent demand for well-priced homes.
Contrary to projections made a year ago, where a 2% drop in average new seller asking prices was anticipated for 2023, the actual decrease stands at a modest 1.3% year-on-year. The average asking price for a home in Great Britain now hovers just above £362,000, showcasing the market’s remarkable stability.
Looking ahead to 2024, the housing market is gradually regaining a sense of normalcy after the post-pandemic frenzy. Experts predict a marginal 1% decrease in average new seller asking prices nationally by the end of 2024, primarily driven by heightened competition among sellers vying for potential buyers.
These projections are rooted in comprehensive market data and a sophisticated predictive model that incorporates millions of data points related to supply, demand, and pricing. Insights from estate agents and a panel of experts further contribute to the accuracy of these forecasts, offering a holistic view of the market landscape.
Recognizing the diverse dynamics of local markets, the projected fall in new seller asking prices will be more pronounced in some areas of Great Britain than others. In regions with limited homes for sale, we may even witness new seller asking prices remaining flat or experiencing a slight increase compared to this year. The market’s ability to adapt and respond to local conditions is a testament to its resilience.
For those planning to sell a home in 2024, pricing remains a pivotal factor. The current level of sales agreed is 10% lower than in the more normal market of 2019. This year has seen 39% of properties with an asking price reduction during marketing, compared to 29% last year and 34% in 2019. The average time for a seller to find a buyer has increased from 45 to 66 days. Competitive pricing has proven to be a key factor in expediting the sale process, emphasizing the importance of setting an attractive and reasonable initial asking price.
On the mortgage front, average rates have steadily declined since July, providing home-movers with greater stability and certainty. While rates remain higher than historic lows, the mortgage market is notably calmer. Affordability, however, remains a consideration for many home-buyers, with the Bank of England indicating that Base Rate cuts are not imminent.
Looking forward, 2024 promises more choices for home-buyers, as the market moves away from the stock-starved pandemic years. Buyers entering the market in 2024 will have the advantage of negotiating on price and taking the time to choose the home that suits them best. Although the number of available homes has only recently increased to pre-pandemic levels, there are no signs of an overwhelming influx of new listings. With more choices and fewer buyers, sellers who price competitively will undoubtedly capture the attention of prospective buyers.
For those contemplating a move in 2024, exploring mortgage options through a mortgage calculator or applying for a Mortgage in Principle can provide valuable insights. Additionally, understanding different types of mortgages and selecting a mortgage term aligned with current and future needs will contribute to a well-informed decision-making process. As the housing market continues to evolve, staying informed and adapting to changing conditions will be key for both buyers and sellers alike.
