Renewed Momentum in Price-Sensitive Property Market

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Property Prices See First Annual Rise Since August 2023, According to Rightmove

The latest Rightmove research paints a positive picture of the UK property market, suggesting that the Boxing Day bounce has maintained momentum as we move out of the winter and into the spring months.

This could be good news for investors looking for a more active market to buy and sell properties. If you were waiting for affordability and activity to regain footing before making any investment decisions, Rightmove suggests that we may have turned a corner amid sustained momentum over the last six weeks.

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How Much Have UK Property Asking Prices Risen?

This month, new seller asking prices increased by 0.9%, equivalent to £3,091 in actual money, reaching £362,839, as noted by Rightmove. This rise aligns with the expected seasonal trend for February.

Average prices have risen by 0.1% compared to last year, marking a reversal from the continuous annual declines since August 2023, suggesting a strengthening market trend.

In the first six weeks of this year, the number of agreed sales is 16% higher than last year. This indicates that early-bird buyers perceive favourable market conditions in 2024 and are taking advantage of the opportunity to make moves.

However, the market remains highly price-sensitive. Accurately priced properties find buyers quickly, while those with inflated price tags linger on the market, potentially missing out on the crucial spring moving season.

Rightmove’s Tim Bannister said:

“We said that February would be an important indicator for the year ahead, and the question was whether the Rightmove Boxing Day bounce in buyer activity would keep its spring into March or lose momentum.

“It’s proved to be the former, with the number of sales agreed to continue to considerably outstrip last year. Early-bird Boxing Day buyers got a head start in cherry-picking from a record level of new property choices and have now been joined by many other buyers who also believe that 2024 offers the right market conditions to move.

“Mortgage rates have fallen considerably from their peak and are now remaining broadly stable after the uncertainty of late 2022 and 2023. Momentum to move in 2024 is continuing to build, but prospective sellers mustn’t get carried away.

“Buyers now have more choice of property for sale, and many are still very price-sensitive, with mortgage rates remaining elevated. Sellers who are serious about moving this year would be well-advised to ride this wave of increased buyer confidence with an attractive asking price before any pre-election jitters or unexpected events dampen the momentum.”

Discover More: Check out our guides for a non-UK resident buying UK property and how to buy a house through your business in the UK for more property insights.

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What Factors Are Affecting Sales Agreed Numbers?

According to Rightmove, increased buyer and seller activity contributed to increased sales agreed numbers. In the opening weeks of 2024, the number of properties brought to the market grew by 7% compared to last year. In addition, the number of buyers reaching out to estate agents was also 7% higher.

Sales agreed numbers are now 3% higher than they were in 2019, with figures slowly transitioning towards normal levels.

The time to find a buyer is currently the slowest since 2015, excluding the initial lockdown months of April and May 2020. Buyers now have more time to consider their options, making it crucial for sellers to price attractively and stand out.

Rightmove analysis indicates that sellers who price their properties correctly initially are more likely to find buyers and sell quickly.

These figures suggest buy-to-let investors have more time to consider their investment strategy, ensuring they purchase properties with lucrative return potential. For instance, the North West offers good value properties and forecasted buy-to-let returns of 9.2% (according to Savills).

If you’re looking to make money from property – either through investing in off-plan property or buying homes already built – you may want to pay attention to these types of forecasts to focus your property search on areas where you can spend less capital but still appeal to tenants. For instance, Shawbrook Bank research indicates that city centre apartments could be a lucrative investment opportunity, with more potential tenants looking to move closer to city centre offices now hybrid and remote work is becoming less prevalent.

Explore the UK property market further with our 2024 buy-to-let area guides:

Author

Dale Barham

Dale is a property content writer at RWinvest. Keeping a close eye on the UK property market, Dale helps our readers stay informed and up to date on the latest market news and statistics.