Halfway through a highly eventful year, the UK property market is finally beginning to settle down
We’re almost midway through the current decade, and so far, there’s been very little to cheer. The UK property market has been on a rollercoaster journey driven by external events – a pandemic and the ensuing race for space, a cost of living crisis, inward migration and rampant inflation.
Yet as we enter the second half of 2024, there are encouraging signs that the property market may finally be stabilising. A raft of news stories towards the end of June suggested the rest of the year will be more benign to sellers and buyers alike than the preceding period – especially once the dust has settled after the general election…
Positive news
June saw the long-awaited announcement that inflation has finally hit the government’s two per cent target. This should encourage the Bank of England to bring down interest rates, in turn enabling mortgage lenders to reduce their repayment costs. This will benefit existing mortgage holders on variable rates and those approaching the end of favourable fixed-rate deals – but it’ll be most keenly felt by people saving for their first home.
The UK property market would collapse without first-time buyers purchasing affordable homes, enabling sellers to move up the ladder and underpinning property chains. Soaring house prices have been an obstacle to first-time buyer activity, so there was more good news in June as a tranche of house price reports indicated a levelling off in values. Although different platforms use their own pricing models and statistical data, the stories they tell have been remarkably consistent:
- Rightmove data on asking prices in Great Britain showed a 0.0 per cent change month-on-month, with properties being advertised for just £21 less than in May.
- Zoopla also reported a 0.0 per cent month-on-month change in their most recent data, with average UK house prices just £210 lower (0.1 per cent) than in April 2023.
- Bucking the trend, the Office for National Statistics reported a 1.1 per cent increase in average UK house prices in the year to April 2024, albeit still a modest rise.
Local focus
While national figures paint a picture of UK property market activity, local data is far more important for buyers in Newcastle and the north-east. The latest Rightmove data shows a modest three per cent decrease in selling prices throughout Newcastle over the last year, whereas ONS data shows a three per cent increase during the same period. The truth is probably somewhere in between and reflects the reports mentioned above– prices are holding steady. In many respects, this is the ideal scenario; sellers don’t have to worry about their assets depreciating, and buyers can save without seeing house prices racing away from them.
Rightmove’s data suggests Tyneside prices have returned to the levels we saw at the market’s 2021 peak of £215,000 on average. Flats here remain among the most affordable in Britain, with average selling prices of just over £128,000, while ONS data suggests the average price paid by first-time buyers across Tyneside in April 2024 was £167,000. That’s roughly five times average UK earnings, compared to a ratio of 12 times average earnings required by first time buyers in London. Then again, the north-east remains by far the cheapest place to buy property in England.
As a locally based agent, with an instinctive and in-depth knowledge of the local market, Cloud Estates is ideally placed to help sellers and buyers navigate the unexpectedly calm waters of today’s UK property market. Get in touch on 0191 640 2478 to see how we can help you navigate the property ladder.
