Spring is in the air and the property market appears to be in better shape than many predicted during the dark days of last October. According to recent data from Rightmove, the housing market is showing green shoots of recovery. The topline of the report states that the market is better than expected and more buyers are returning, so are we seeing the green shoots of recovery?
Buyers return to the market
According to recent figures, average asking prices for homes in February have remained steady, with only a slight increase. However, this is actually a positive sign considering the widespread expectation of a potential drop in house prices of up to 7% this year. The resilience is particularly noticeable in London, where the average home sold achieved 98.2% of its asking price in January. This is an improvement from 96.8% in December. The rise was mainly driven by smaller homes at the lower end of the market, and with mortgage rates falling, affordability has improved.
Hamptons reported that homes priced below £500,000 in London achieved an average of 99.5% of their asking price in January. On the other hand, homes priced above £500,000 are more sensitive to pricing, partly because a higher proportion came onto the market before the mini-Budget and typically take longer to sell.
Rightmove's data also shows that more people are getting in touch with estate agents again. In the last two weeks, prospective buyer enquiries have increased by 11% compared to the same period in 2019, which was the last year with a ‘normal’ housing market. The number of sales agreed has also rebounded, with a 30% drop immediately following the mini-Budget, now reduced to just an 11% drop from 2019. Interestingly, it is the first-time buyer sector that is recovering better than the discretionary upper-end sector, which is a significant shift.
Time will tell
However, the true strength of the market will be put to the test in the spring. Fresh data from HMRC shows that 96,650 homes were sold in January, which is 11% down on the same month last year and 3% down on December 2022.
Mortgage rates have been gradually edging down, with a number of lenders recently unveiling sub-4% five-year fixed-rate mortgages. But the market may still see pricing fluctuations over the next few months, with no visible trend. Therefore, it is essential for potential buyers to speak to independent mortgage consultants to understand the best options for their individual circumstances.
Overall, the recent data suggests that the property market is showing signs of a softer landing than initially expected. With the spring market yet to come, it is worth keeping a close eye on the market and speaking to an independent mortgage consultant to navigate the ever-changing landscape.
Talk To Tony
Our independent mortgage consultant, Tony, is always on hand to help answer any of your mortgage questions. Simply book yourself an online face-to-face mortgage appointment at a time that suits you, or drop Tony a line on info@skylinemortgages.co.uk and get the mortgage clarity you need, before you make your move.
Your home (or property) may be repossessed if you do not keep up repayments on your mortgage or any other debts secured on it. A fee may be charged for mortgage advice. The amount will depend on your circumstances.
Skyline Mortgage Consultants Limited is an Appointed Representative of The Right Mortgage Ltd, which is authorised and regulated by the Financial Conduct Authority. Skyline Mortgage Consultants LTD registered in England and Wales Number 8157062. Company Registered Office: Heathmans House, 19 Heathmans Road, London SW6 4TJ