Services

The latest figures released by the Halifax Building Society show that the UK property market continues to bounce back from the dip during 2023. 

The Guardian reports that the data shows that the average UK house price is now just £1,800 off the peak of June 2022. This is reflected in estate agents reporting an increase in buyer demand during March.

The greater confidence has been driven by lower mortgage rates, and London is at the helm of the recovery. Industry leaders cite more people returning to work at the office, wage rises, and the easing of inflation as key drivers of demand for properties for sale in the capital, particularly in highly sought after neighbourhoods such as Hackney. 

Tim Bannister, the director of property science innovation at Rightmove, said: “It’s been a positive first three months of the year for the market and better than many anticipated. However, we know from last year how quickly the picture can change.”

He added: “Sellers are right to feel more confident and optimistic this year, but buyer affordability remains stretched and higher mortgage rates are an ongoing challenge. With the market still sensitive to pricing and external events, some caution and willingness to negotiate is advised.”

Furthermore, The BuyAssociation reports that there are fewer people with concerns about keeping up with their mortgage repayments. A survey by the Building Society Association (BSA)  found that 90 per cent of respondents reported that they had no concerns about the issue, compared with 85 per cent in December 2023.

This is supported by a healthy boost to annual wage growth, which has risen by an average of 6.1 per cent between November 2023 and January 2024. There is also the broadest range of mortgage options available since 2008, with many low-deposit options to attract first time buyers.

Paul Broadhead, Head of Mortgage and Housing Policy at the BSA said: “The overall reduction in mortgage rates following the peak in 2023 has been welcomed by homebuyers, and has seen an improvement in confidence in the housing market.”

“While consumer prices remain high, wage growth has been strong meaning many households are now in a stronger position than six months ago. There is also an expectation that if inflation continues to fall, the Bank Rate may be cut this year, further easing pressures on borrowers and increasing mortgage affordability.”

He added: “Whilst affordability of mortgage payments remains the biggest barrier to house purchase, it is reassuring that this has reduced over the past six months. Expectations around house prices reflect this more stable outlook for the housing market.”

However, the BSA has commented that more needs to be done to help first time buyers in the UK to overcome the barriers to home ownership. It calls for more flexible mortgages with a range of repayment options, longer terms, and the introduction of part-repayment, part-interest only mortgages.