Nestled in the heart of North Yorkshire, Harrogate stands out as a gem among towns, celebrated for its unique blend of independent boutiques, cosy cafes, and gourmet restaurants. Its proximity to major cities like Leeds and York, coupled with its reputation as a safe and vibrant town, has made it a sought-after location for homeowners and investors alike. What’s in store for Harrogate’s housing market in 2024?

Population and Housing Trends

Between 2011 and 2021, Harrogate’s population saw a modest increase of 3%, trailing behind the overall growth rate of England at 6.6%. The town boasts a median age of 47, indicating a significant portion of the population (around 46%) is aged 50 or above. This demographic shift has implications for the housing market, especially with changes in homeownership rates and the rise in social and private renting.

Despite these shifts, Harrogate’s property market remained robust, with the average home price reaching £394,000 in 2023—£44,000 more than the national average. This price point, however, suggests that a surge in demand from local residents might not be on the horizon.

Economic Indicators

Harrogate’s economy, particularly its tourism sector, has been on an upswing, injecting an additional £31 million into the local economy in 2022 compared to 2019. This economic vitality, buoyed by a recovering income level post-pandemic, hints at a potential increase in purchasing power over time. Yet, this is a gradual process, unlikely to cause an immediate spike in housing demand.

External Influences at Play

Recent times have seen housing affordability challenged by rising interest rates and inflation, dampening the enthusiasm for home purchases. However, a turn of the tide was noted in January, with house prices hitting a yearly high, alongside a decrease in inflation and the anticipation of reduced interest rates. This combination is expected to rejuvenate demand in the housing market.

Housing Market Activity

The supply of new builds in Harrogate has been scant, with only 2% of property purchases last year involving new constructions. This scarcity, coupled with a significant portion of properties selling for £500,000 or more, underscores a shift in the market dynamics. The dwindling proportion of houses selling for £250,000 or less over the past two decades further accentuates this trend.

What’s Next for Harrogate?

The convergence of a limited supply of new builds and the potential for lower interest rates sets the stage for a possible uptick in Harrogate’s house prices in 2024. As mortgages become more affordable and the charm of Harrogate continues to attract buyers, the housing market in this picturesque town is poised for growth.

In essence, Harrogate stands at a crossroads, with several factors converging to shape its housing market in the coming year. While challenges remain, the underlying strength of its economy, coupled with favorable external conditions, suggests that Harrogate’s housing market could well experience a rise in prices in 2024. As always, the future holds its secrets, but for Harrogate, the outlook is cautiously optimistic.