House prices are on the rise thanks to lower mortgage rates which have tempted more buyers into the market. But if you’re thinking of selling, don’t get too excited just yet, as buyers are still looking for a bargain and driving down asking prices.

Zoopla’s latest data reveals that house prices inched up by 0.7% in the year to August, a welcome change from the -0.3% dip recorded this time last year.

What’s behind this increase?

Well, it’s all about those appealing mortgage rates! The average rate for a five-year fixed-rate mortgage currently sits at a tempting 4.3%, a significant drop from the 5.5% we saw this time last year. This marks the lowest rate since May 2023, according to Zoopla.

Northern Ireland and Scotland Lead the Property Pack

While the market is looking rosy overall, some regions are seeing a bigger boom than others. Northern Ireland and Scotland are leading the pack with the most impressive house price growth. However, the South East of England, East of England, and South West saw a slight dip.

Second Home Owners Cashing In?

Another factor influencing the market is the influx of properties being listed by second home owners. Why? It appears they’re trying to avoid the looming council tax hikes coming into effect from April 2025.

These new rules could see some second home owners facing double the council tax on their properties. It’s no surprise then that areas like Truro, Torquay, Exeter, Lincoln, and Bournemouth, where these rules are being adopted, have seen a 40% surge in homes listed compared to the same period over the last seven years.

Landlords, too, are jumping on the selling bandwagon. They’re bracing themselves for potential capital gains tax changes expected in the upcoming Budget, prompting many to cash in on their investments now.

Buyer Demand is High but Affordability Remains a Concern

Zoopla’s data shows that buyer demand was up by a healthy 26% last month compared to last year. This increase, coupled with more properties being listed for sale (up 12% from this time last year), means there are plenty of opportunities for buyers and sellers alike.

However, affordability continues to be a key factor, particularly in the south of England where house price growth remains subdued.

Top Tips for Sellers

• Price it Right: Buyers are savvy and looking for a deal. Setting a realistic asking price is crucial to attract interest and secure a sale.
• Don’t Delay: The market is currently buoyant with good levels of buyer activity. If you’re serious about selling, there’s no time like the present!

Top Tips for Buyers

• Shop Around for the Best Mortgage Deal: With competition among lenders at an all-time high, there are some attractive mortgage rates to be had.
• Don’t Be Afraid to Negotiate: While the market is competitive, there’s still room for negotiation, especially if you’re a first-time buyer or have a significant deposit.

Overall, the UK property market is showing positive signs of growth, driven by low mortgage rates and increased buyer demand. However, it’s essential to keep an eye on factors like interest rates and potential tax changes that could influence the market in the coming months.