According to the latest figures from the property website Zoopla, both buyers and sellers are stepping back into the market with renewed enthusiasm. February witnessed an increase in property transactions, setting the stage for a projected 10% rise in home sales throughout the year.

Zoopla’s data paints an optimistic picture of the property landscape, with all indicators pointing upwards compared to the same time last year. February saw agreed sales leap by 15% and buyer demand swell by 11%. This bustling activity suggests the market is on a path to achieve around 1.1 million transactions in 2024, a significant bump from the 1 million recorded in 2023.

A Mixed Bag of Price Movements

While the overall UK property prices dipped slightly by 0.5% year-on-year, the story varies greatly across different regions. Scotland, Northern Ireland, Wales, the Midlands, and the north of England enjoyed price increases. Conversely, the southern regions faced declines, with the east of England experiencing a notable 2.1% drop. High-priced areas, primarily in the south, felt the brunt of affordability challenges, exacerbated by soaring mortgage rates and living costs.

Mortgage Rates

The mortgage landscape has been a rollercoaster, with fixed-rate mortgages hitting their peak since 2008 last summer, following the base rate’s climb to 5.25%. The subsequent pause in rate hikes by the Bank of England offered a brief respite, leading to a decrease in mortgage prices and fuelling the market’s recovery. However, Zoopla warns of a shift, as the most affordable mortgage options begin to vanish, predicting rates to hover between 4-5% for much of 2024.

Expert Insights

Sarah Coles, a leading voice in personal finance at Hargreaves Lansdown, acknowledges the market’s current vitality but cautions against complacency, “Falling mortgage rates at the end of 2023 and beginning of 2024 made the key difference in boosting market optimism, and rates are starting to rise again. They’re still only roughly where they were a year ago, and the average two-year rate is still under 5.75%, but a rise may persuade some buyers to press pause. We’re seeing the impact of relentless eye-watering price rises over the past few years. As a result, affordability is a major problem, and we’re still seeing asking prices drop significantly.”