Property Market Update: August 2024

Welcome to the August edition of the Property Market Report! We've collated information from experts from across the UK to provide you with a comprehensive view of the current market.

Market conditions are subdued but stable

Despite indications from the Royal Institution of Chartered Surveyors (RICS) and the Bank of England (BOE) that the market is subdued, overall conditions seem stable! Political certainty and anticipation towards the BOE’s recent base rate cut have positively influenced the market, leading to a 15% increase in the number of sales agreed compared to the same period last year.

Nationwide notes that market activity has been steady, with around 60,000 mortgages approved for house purchases per month, although this remains 10% below pre-pandemic levels.

House prices rise once more

House prices are rising in earnest once more, reversing the falls recorded over 2023. Nationwide reports that the average house price is £266,334 in July (+0.3% m/o/m), while Halifax reports that the average house price is £291,268 (+0.8% m/o/m). Zoopla maintains its prediction that house prices are on track to be 2% higher by the end of 2024.

Asking prices adjust

Asking prices, on the other hand, are experiencing some adjustments. Rightmove reports that new listing prices dropped by 0.4% (-£1,617) in July to £373,493, a larger decline than usual for the month.

Despite this, buyer activity remains steady, with the number of new sellers 3% higher than last year. Additionally, UK buyers are paying a greater proportion of the asking price, currently at 96.8%, up from 95.6% in October of the previous year.

Mortgages: Improving picture in wake of base rate cut

The mortgage market in the UK remains challenging but shows signs of improvement.

• According to the financial information service Moneyfacts, the average two-year fixed rate is currently at 5.77% while the average five-year fixed rate is 5.39%.
• Nationwide reports that the rate for a 5-year fixed mortgage with a 25% deposit has been around 4.6% in recent months, more than double the 1.9% average recorded in 2019, making affordability still stretched for potential buyers.
• The Bank of England’s decision to cut the base rate on the 1st of August to 5% (-0.25) will have a positive impact on the mortgage market - while many banks and building societies will have already factored the base rate change into their pricing, this is undoubtedly good news for movers across the property ladder.

Summary: Things can only get better

To surmise, while the market is subdued, things are beginning to look up for the property market! It’s a fantastic time to get your property on the market to take advantage of new buyers, especially now mortgage rates are falling in the wake of the base rate reduction.