The steady momentum in new sales that has developed over the final part of 2023 will continue into early 2024 alongside the usual seasonal rebound in demand over Q1 2024 as pent-up demand returns to the market. While mortgage rates are edging lower, affordability remains a key challenge for mortgage reliant households who are making home moving decisions. The impact of higher mortgage rates continues to be felt with half of those with mortgages yet to move onto higher rates from cheaper fixed rates agreed before 2022.

Despite the affordability challenges facing first time buyers they will be the largest group of would-be buyers in the next two years as the rapid growth in rent continues to motivate this group. Unsurprisingly average rents have risen faster than average mortgage repayments over the last three years.

Reflecting on the latest data from Zoopla, Tom Bill, head of UK residential research at Knight Frank, said: “Activity in the property market was stronger in November than September this year, which is not normally the case. Confidence is returning as inflation comes under control and there is growing downwards pressure on mortgage rates.

“The final weeks of 2022 were marked by the fallout from the mini-Budget, when the property market effectively closed three months early for Christmas. This year, it is stirring into life after a subdued summer and all the indications are that there will be a seasonal bounce next spring provided a general election is not called in the first half of 2024.”

Matt Thompson, head of sales at Chestertons, added: “December tends to be a quieter time of year in terms of property transactions but buyers have been more motivated this month to continue their search. Built up demand caused by this year’s economic uncertainty is a key reason for this delay in buyer activity and indicates that 2024 will start off with a very active property market.”

Source: Property Industry Eye