What Can We Expect From The Property Market in 2024?
The housing market has been quite turbulent over the last few years, to say the least. Although there have been some significant changes, the market has been better this year than it was predicted. Asking prices have been lower than anticipated and there have been increased levels of interest from buyers who are in search of the right-priced property. Even though this is all good news, the impact of rising mortgage rates and interest rates have heavily impacted the level of affordability for a lot of residential buyers.
With these factors in mind, predicting the property market for 2024 can be difficult, but based on trends and data from previous years, there are some things which we can expect from the property market in 2024.
Compared to the “normal” housing market in 2019, the number of sales which are being agreed is currently 10% lower. In the past year, Rightmove have found that 39% of properties listed saw a reduction in asking price during the listing period. In 2023, this figure was 29%, whilst in 2019 it was 34%.
The average time that it now takes for a seller to buy a property has also increased in the past 12 months, going from 45 days to 66 days. But, alternatively, sellers who have started with a competitive price have on average been able to find a buyer more quickly than those who start off with higher prices, before reducing down.
New sellers will need to compete with those who cut prices and work with estate agents to offer a competitive price from the outset, rather than putting off potential buyers with inflated prices.
The property market will continue to return to pre-pandemic levels of activity in 2024, with the potential for asking prices to fall by a further 1% nationally before the end of the year. The housing market consists of thousands of different local markets, all of which have their own level of supply and demand. The decrease, as a result, will be felt much more in certain areas of the country than others, but overall asking prices should fall particularly in areas where sellers might be struggling to attract buyers or have a need to sell their property much quicker than anticipated.
Thankfully, mortgage rates have continued to fall steadily since July 2023 and this has provided homeowners with more stability than the years previously, as well as more certainty in terms of the cost and type of mortgage they can receive. Now, the average fixed rate is 5.48%, however, the average five-year fixed rate is 5% and, although high compared to historic levels, the mortgage landscape is calmer than it has been previously. Many buyers, for whom the market was too volatile last year, may now decide to resume their house search this year as a result of the calmer market.
A property crash has been predicted for several years and many experts are still expecting one to happen. However, a lot of data points towards the fact that a crash is very unlikely to happen any time soon. Many housing experts are in the belief that the housing market this year will rebalance itself, but there is still uncertainty surrounding the market and there is a lack of buyer confidence as a result of the market crash rumours.
First-time buyers, especially those who are using lower deposits, have less confidence in the market as a result. This isn’t just an issue with the residential market, with commercial property agents also finding that many commercial properties are noting the same disruption in confidence.
Written by Agency Express guest writer Natalie Wilson