Good news for sellers as Zoopla predicts a 2% rise in house prices by the end of the year!

After a chilly 2023, things are heating up, with Zoopla reporting a surge in sales and buyers digging deeper to secure their dream homes.

Prices Up Across the Board

In a welcome turn of events, house prices have gone up in every corner of the UK during the first half of 2024. If this trend continues, we could see a 2% overall increase by January 2025.

More Homes, More Choice, More Sales!

One of the key drivers behind this positive shift is the sheer volume of properties hitting the market. Estate agents are reporting an average of 33 homes for sale each – a six-year high. This abundance of choice is encouraging buyers to take the plunge, leading to a 16% surge in sales compared to last year. In fact, sales figures have skyrocketed to an impressive 22% above pre-pandemic levels.

Buyers Digging Deeper

Remember those days of lowball offers? Well, they seem to be fading into the past. Buyers are now forking out an average of 96.8% of the asking price – the highest percentage in 18 months. To put that in perspective, homes are now selling for around £16,600 below asking price, a significant improvement on the £23,000 discount buyers enjoyed last October.

What’s Fuelling the Fire?

The Zoopla report highlights several factors contributing to this positive trend:

• Economic Growth: A stronger economy usually translates to a more buoyant housing market.
• Rising Incomes: With average incomes projected to climb by 4.5% this year, people have more money in their pockets to invest in property.
• Increased Home Building: A boost in construction means more homes are available to meet the demand, keeping the market competitive.

Mortgage Rates Play a Part

The recent dip in mortgage rates has also given the market a shot in the arm. For the first time since February, the lowest five-year fixed rate mortgage dipped below 4%, making homeownership more accessible to a wider pool of buyers. While the average five-year fixed rate currently stands at 5.4%, this is still significantly lower than the 6.35% recorded this time last year.

Experts Optimistic About the Future

Richard Donnell, executive director at Zoopla, believes this positive momentum is set to continue: “The housing market is essentially an extension of the UK economy. Government policies focused on economic growth that feeds into income growth will help support both home buyers and renters.”

First Base Rate Cut Could Further Boost the Market

Industry experts predict that the first anticipated base rate cut from the Bank of England will inject even more confidence into the market. While opinions are divided on whether the cut will occur this week or in September, most agree that it will lead to a surge in activity.

Simon Gerrard, managing director of Martyn Gerrard estate agents, shares this optimism: “Inflation has held steady at the Bank of England’s target of 2 per cent, so there is a strong chance that the base interest rate will come down in August or September, which will fire the gun on property searches that have been on hold.”

A Word to the Wise

If you’ve been sitting on the fence about buying or selling, now might be the perfect time to make your move! With prices on the rise and a positive outlook for the future, there’s never been a better time to join the property ladder!