JUNE 2024 PROPERTY MARKET UPDATE

During June we’ve seen the UK property market continuing on its path of cautious optimism. While the fast growth seen in previous years has eased, a sense of stability is emerging, underpinned by rising buyer demand and a potential shift in interest rates.

Let's delve into the key trends shaping the market this month.

Market Recovery Gathers Momentum

The good news for buyers and sellers is that the property market is experiencing a steady recovery. After a period of uncertainty, house prices are showing signs of growth again. According to Nationwide Building Society, May 2024 saw a 0.4% increase in average house prices, bringing the annual growth rate to 1.3%. This indicates a market that's found its footing and is on an upward trajectory.

Regional Variations Remain

While the national picture is one of growth, it's important to remember that the UK property market is a patchwork of regional variations. Scotland continues to lead the pack with a significant 6.7% annual increase in house prices, while England and Wales are seeing more modest rises of 1% and 1.3% respectively. Northern Ireland has also shown steady growth of around 4%. Understanding these regional differences is crucial for both buyers and sellers when making informed decisions. If you would like to know more about the Norwich and Norfolk region, please call us on 01603 973214 to discuss.

The Interest Rate Question

A significant factor influencing the market is the ongoing speculation around interest rates. With inflation falling closer to the Bank of England's 2% target, a potential base rate cut is on the horizon. This could be a game-changer for the market, making mortgages more affordable and potentially boosting buyer demand. Economists predict the first cut could come as early as August 2024. The impact of this on house prices remains to be seen, but it's likely to contribute to a more vibrant market.

Election Jitters or Business as Usual?

The upcoming general election in July has caused some to wonder if it will stall market activity. However, experts suggest this is unlikely to happen. In contrast to past elections with significant policy shifts, the current political landscape doesn't propose drastic changes impacting the housing market. The first interest rate cut, however, is expected to have a more significant impact on market activity this year.

Supply and Demand: Finding Balance

The good news for buyers is that there are signs of a healthy increase in the number of properties coming onto the market. This increased supply is expected to keep house price inflation in check throughout the year. While significant price hikes might be off the table for now, the steady flow of properties ensures buyers have more options in a balanced market.

What Does This Mean for You?

Landlords: The rental market continues to see high demand, with rents rising at a slower pace than the previous year. Zoopla reports an average increase of 6.6% for new lets in April 2024. While this presents an opportunity for stable returns, it's important to remember tenant retention is key. Focusing on good communication, responsive maintenance, and ensuring your property remains competitive in terms of rent and amenities will be crucial for attracting and keeping quality tenants.

Buyers: With a potential interest rate cut on the horizon, affordability might improve in the coming months. However, with increased competition due to rising demand, it's still a seller's market in many areas. Being prepared with a well-researched offer and a strong financial position will be key to securing your dream property in Norwich and Norfolk.

Sellers: While significant price rises are less likely, the market conditions remain favourable for sellers. At JaeVee we suggest focusing on presenting your property in its best light through minor improvements, home-staging and competitive pricing to attract buyers quickly in a market with more options.

The Bottom Line

The UK property market is moving towards cautious optimism. House prices are showing signs of growth, with regional variations offering opportunities for both buyers and sellers. The potential for a base rate cut later this year could be a major driver of market activity. With an increased number of properties coming to the market, a sense of balance is emerging. Whether you're a buyer, seller, or landlord, staying informed and seeking expert advice will be crucial for navigating the market effectively.

About JaeVee

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