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  • Writer's pictureGavin Human

Moving on, moving forward, and moving home in 2024?

Welcome 2024

2023 was certainly a challenging year for the housing market, but the property crash and recession that many predicted at the end of 2022 did not happen. According to Nationwide, UK house prices fell by 1.8% in the 12 months to December, recording the biggest decline over the course of a year since 2008 during the global financial crisis.

 

However, the property market in Cambridge remains fairly bulletproof. According to the latest available statistics from the Land Registry, the average price of a property over the last year was £578.396. the majority of sales in Cambridge were terraced properties selling for an average price of £588,392. Apartments sold for an average of £333,530 with semi-detached properties fetching £619,293.

 

Looking further afield, we saw the average sold price across Cambridgeshire drop to £365,555. The majority of sales were detached properties, selling for an average price of £498,346. Semi-detached properties sold for an average of £337,602 with terraces fetching £299,543.

 

The big difference was the number of overall transactions dropping by 36.2%, down to 8029.

 

The battle to control rising inflation resulted in continued hikes in interest rates for 14 consecutive months and peaked at 5.25% at the end of October.  This resulted in lower buyer demand throughout the year as current homeowners were worried about higher repayments. 

 

As the door opens to 2024, there are signs that market conditions are improving.

 

Many homeowners have faced large increases in their monthly mortgage repayments as their current fixed deals come to an end. It is estimated around 1.6 million fixed-rate mortgage deals are due to end this year, meaning the vast majority of borrowers will see their monthly repayments rise sharply.

 

Since October 2023  the Bank of England has held interest rates at 5.25% for the last three occasions and the talk is now turning to when they might start to fall as the latest data shows a sharp drop in inflation to 4.6% - its lowest level in 2 years. This has had a knock-on effect, with many lenders reducing their rates over the last couple of months. As of the end of December, the average two-year fixed mortgage deal was 5.95% whilst the average five-year fixed was 5.57% according to Moneyfacts.

 

The lower mortgage rates provided a welcome boost to house sales which grew in November, up 0.8% from October and breaking a streak of five consecutive monthly declines.  Year-on-year, sales fell 7.3%

 

The first interest meeting of 2024 will take place on 1st February so it will be interesting to see how we start the new year. Many of the mainstream lenders have released their forecasts for the UK housing market. Lloyds predicts a continued decline but with growth beginning in Q1 of 2025. Santander forecasts a fall in 2024 as well as a rebound in 2025. Nationwide believes the market will remain sluggish and has predicted a 2% drop.

 

WHAT DO I THINK?

 

My own views is that we will see a slight upturn in buyer confidence as interest rates remain pegged or even reduced in the second half of the year. We might also see some Government incentives - with an election to be contested - including a Stamp Duty Holiday for properties under £1million to give the economy a boost. This would result in a higher number of sales being agreed, and possibly some price increases in some areas.


If you're thinking of moving and would like a confidential, no obligation chat, to discuss oyur options, don't hesitate to get in in touch.


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