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UK Housing Market Sees Uptick in Asking Prices

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    Asking Prices Rise to Highest Level Since 2020

    According to Rightmove, UK buyers and sellers are showing renewed confidence in the housing market, with the average property price rising by the highest levels since 2020.

    Is this a sign of things to come for UK buy-to-let investors? And what does it mean for the property market as a whole for the rest of 2024?

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      What Did the Latest Rightmove HPI Say About the UK Housing Market?

      Rightmove’s latest house price index indicates a 1.3% month-on-month increase in average new seller asking prices to £359,748.

      However, values are still 0.7% lower than this time last year.

      The first week of 2024 shows promising activity, with a 15% rise in new properties coming to market and a 5% increase in buyer demand compared to the same period last year.

      Competitive pricing remains crucial as the number of new properties surpasses the rise in demand, with investors still weighing up buy-to-let costs amid higher mortgage rates and raised interest rates.

      Additionally, sales agreed during the first week of 2024 are 20% higher than the previous year.

      Rightmove notes increased interest post-Christmas, with nine of its ten busiest days for mortgage inquiries since then.

      Rightmove’s Tim Bannister had the following to say about the most recent Rightmove data:

      “After a stop-start market in 2023, the initial signs suggest a smoother year for movers in 2024. More new sellers are now entering the market with more confident pricing.

      “While the increased level of buyer activity that we’re also seeing may justify some of this increased pricing confidence from sellers, it’s important that sellers who are keen to find a buyer don’t get carried away with New Year enthusiasm when setting their price expectations. Elevated mortgage rates and the wider cost-of-living squeeze are still limiting buyers’ spending power. Accurate and realistic pricing for their local area is the recipe for success for sellers looking to get moving in 2024, and it’s been proven that over-optimistic pricing makes a move much less likely.”

      Find Out More: Make sure you know how to spot low-risk investments in the UK to make the most out of your buy-to-let strategy. Alternatively, check out our comprehensive guide on how to buy a house to rent out.

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      How Have Other Industry Experts Reacted to the Early 2024 Housing Market?

      Elsewhere in the housing market, other industry figures have noted an uptick in activity.

      For instance, Zoopla research shows that more buyers are looking for properties than there were this time last year. The number of people looking to buy property in the UK has increased by 10%.

      Zoopla also stated that property price decline has started to slow, while sales agreed prices have risen by 17%. This makes the average UK property 18% more expensive than Spring 2020.

      ReallyMoving – a comparison website – also noted an increase in market activity, stating that registrations for home move services had improved by 73% in the first week of January, compared to the same period during 2023.

      They said:

      “It’s encouraging to see a burst of home mover activity at the start of this year. People will only put their lives on hold for so long, and while the cost of borrowing is still a significant issue, it appears that many of those who held off in 2023 are now making the decision to go ahead, encouraged by the resilience of prices and some downward movement in mortgage rates as lenders compete for business.

      “We don’t expect to see a full recovery in transaction volumes this year, and prices may dip further before we see a return to sustained growth. But the market has proved to be more resilient than many expected, households are slowly adjusting to higher borrowing costs, and with housebuilding volumes still falling far short of the required level, early signs suggest that 2024 could be a better year for the housing market.”

      Read More: For more information on how to make money with property, be sure to consult our guide on UK property investment.

      2023 Outperforms Expectations, Paving Way for Potential Growth in 2024

      Knight Frank has also chimed in on the 2024 property market, changing their initial prediction of a 4% price drop by the end of the year. They now forecast a cautious 3% property price growth over the next 12 months. This would mark a resounding change in fortunes from what forecasters anticipated at the start of 2023.

      Last year, some experts foresaw a property price decline between 5% and 10%. However, Halifax noted a 1.7% rise in property prices during 2023, highlighting the property market’s resilience in the face of economic uncertainty.

      If you’re looking for some additional information on the UK buy-to-let scene, check out some of our handy area guides, including:

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      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.