UK property sales are forecast to rise by 10 per cent as buyers and sellers return. Data from online property company Zoopla showed the housing market is on track to reach 1.1 million transactions across this year.
The latest data from property website Zoopla shows all measures of activity were higher than in February 2023, with agreed sales up by 15 per cent and buyer demand up by 11 per cent. Across the UK prices were down by 0.5 per cent year-on-year.
Zoopla said this had supported the upturn in activity “along with faster growth in household incomes”. However, it noted that the cheapest, sub-4 per cent, mortgages were now being pulled by lenders amid the ongoing Cost of Living crisis across the country.
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“Buyers should anticipate 4-5 per cent mortgage rates over much of 2024, consistent with flat to low single-digit price rises,” it said. Sarah Coles, head of personal finance at Hargreaves Lansdown, said that while the increase in activity was good news for sellers, the housing market still faces “some serious hurdles”.
Ms Coles said: “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 per cent but a rise may persuade some buyers to press pause.”
Ms Coles added that in the south, excluding London, “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”.
“More sales and more sellers shows growing confidence amongst households and evidence that 4-5% mortgage rates are not a barrier to improving market conditions,” says Richard Donnell, executive director at Zoopla.