As more property buyers and sellers return to the market, UK housing demand has increased by 11%, boosting sales.
Demand from UK property buyers is now 11% higher than last year, with the first few weeks of January 2024 off to a strong start as falling mortgage rates and pent-up demand since the second half of 2023 spurred economic activity, with the latest data suggesting the momentum has continued into the first half of February.
On an overall level, demand from UK property buyers is 11% higher than the same period last year. The number of buyers has risen across the UK, but London is firmly in the lead, followed by the North East and North West, where the property market has lagged the rest of the UK by seven years since 2016, with low levels of house price growth due to tight housing affordability.
With the average value of an apartment just 13% higher than in 2016, compared to 33% in the UK and 50% in Wales, better value for money is improving London's outlook, but it remains an expensive property market.
The property market is healthier and more sold, and one of the best ways to assess the overall health of the property market is to look at the trend in the number of sales that have been agreed, and if buyers and sellers agree to increase sales, it is a sign that the UK property market is healthier and people are able to fulfil their desire to move.
In fact, there is almost a fifth more homes for sale in the UK than a year ago, which gives buyers more options and improves the chances of reaching a sales agreement, with agreed sales up in all regions and countries in the UK, with six regions led by London, the South East, Yorkshire and Humber up by more than 10%.
The increase in demand and sales of UK property has attracted more sellers to the market.
Increased confidence in the real estate market is attracting more sellers in, and the number of new homes listed** has also increased, with new homes for sale flowing 10% higher than a year ago and the highest level since 2020. New sellers are listing their homes in the east, south west and north east of England as quickly as possible.
33 days to agree to ** the house.
In 2023, the average time to sell is 34 days – from the time a property is first put on the market to the time it is agreed**, subject to contractualization, which is 2 weeks more than the hotter pandemic-fueled real estate market in 2022 – when the home was taken within 20 days**.
Setting the asking price at the right level is key to attracting demand and reaching a sales agreement, which can be more difficult for unique or unusual homes. Sellers need to talk to local merchants to understand the market and the demand for their home type.
In 2023, the longest sales period in London and the South East is up to 40 days, with the fastest sales in Scotland (20 days) and the North East (30 days).
This difference mainly reflects the impact of housing affordability and higher mortgage rates on the purchasing power of the UK's high house price market. This is why the fall in mortgage rates has further boosted economic activity in the south of England, especially London.
It is important to note that once a sales agreement has been made, the legal and mortgage procedures can take 3-6 months to reach a contract exchange – and then it is legally done, at which point you can get the keys to your new home.
Activity is expected to continue to increase in the property market in the coming months, with a better balance between sellers and buyers than in the last three years, and sellers are going to remain calm despite reports of UK house prices again.
The good news is that it will be easier for most sellers to find a buyer, and more options for homes for sale will mean more room for negotiation.