How has the housing market performed so far this year?

Report reveals the latest in buyer demand and property availability

How has the housing market performed so far this year?

The turn of the year has seen early signs of recovery for the UK housing market, with a 33% increase in demand nationwide since December of 2023.

The notable resurgence in buyer interest was one of the highlights of e.surv’s latest Property Watch report, which also found the revival in the market being reflected in the supply side too.

According to the report, surveyors reported a 30% rise in the availability of homes for sale in London and the south.

However, the e.surv report also showed a continued trend of properties selling below their initial asking prices across most regions, despite a slowdown in the rate of annual house price declines.

The south of England and Wales are particularly affected, with properties in 60% of these areas being sold for less than their listed prices. London, on the other hand, appears to be bucking this trend with over half of the surveyors, or 52%, noting that sales in the capital have either met or surpassed the asking prices, suggesting a localised recovery in the housing market.

The outlook for new build homes remains less optimistic, according to e.surv, with a significant portion selling below asking price and experiencing longer sales cycles. To counteract this, around 60% of new homes are being marketed with buyer incentives, such as deposit contributions, legal fee payments, and Stamp Duty relief.

Meanwhile, in the rental sector, a contrasting picture of robust demand against a backdrop of limited supply has been observed, especially in Scotland, London, and Northern Ireland.

Factors such as rent controls, economic challenges, and an influx of international students, have intensified competition for available properties, leading to upward pressure on rental prices and underscoring the ongoing challenges in balancing the needs of landlords, particularly those with mortgage obligations, against the increasing demand in the private rental market.

“After a challenging year for the UK housing market, it’s encouraging to see such strong homebuyer demand return at the start of 2024, coupled with an increasing number of homes hitting the market, particularly in London and the south,” said Rob Owens, head of research at e.surv Chartered Surveyors. “Despite this, however, some regions are still seeing many properties sell below the asking price, indicative of the market's ongoing recovery.

“We’re also seeing a testing market for new build homes, which continues to be impacted by affordability challenges following the end of Help to Buy. Many developers now rely on buyer incentives geared towards reducing the upfront cost of purchasing a new home.

Owens pointed out that while the market has been showing signs of recovery, challenges remain, with regional price disparities and sluggish new build sales persisting despite increased buyer demand and supply.

“The upcoming spring budget holds potential policy interventions such as cuts to stamp duty rates, extended first-time buyer schemes, or even a Help to Buy revival,” he said. “However, the scale and impact of these measures will be dictated by the heavily constrained fiscal environment the government finds itself in.”

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