Early-Bird Buyers Drive Market Momentum Amid Price Sensitivity
In a promising turn of events, the UK housing market has witnessed a 0.9% rise in average new seller asking prices this month, reaching £362,839. This increase, in line with the expected seasonal rise for February, marks a noteworthy shift as average prices are now up by 0.1% compared to the same period last year. This positive momentum follows six consecutive months of annual price falls since August 2023.
The surge in market activity is further highlighted by a 16% increase in agreed sales during the first six weeks of 2024 compared to the same period last year. Impressively, it surpasses the more stable market conditions of 2019 by 3%. Early-bird buyers seem to be capitalizing on what they perceive as favorable conditions in 2024, propelling the market forward.
Notably, both buyers and sellers are actively participating in the market, with a 7% increase in new listings and a corresponding 7% uptick in buyer enquiries on Rightmove. This heightened engagement underscores the growing confidence in the real estate landscape.
However, the market exhibits a dual-speed dynamic, emphasizing its price sensitivity. While accurately priced properties are swiftly embraced by budget-conscious buyers, overpriced listings face prolonged periods on the market. The average time to sell has extended, taking more than two weeks longer compared to the previous year, reaching its slowest pace since 2015 (excluding the initial pandemic lockdown months of April & May 2020).
Rightmove's analysis underscores the importance of accurate pricing, revealing that sellers who price their properties right initially are more likely to secure quick sales. This trend underlines the need for realistic expectations in a market where buyers remain conscious of their budgets.
As the 2024 Budget approaches, there's a call for additional support to facilitate first-time buyers' entry into the market. The sector lags behind due to elevated mortgage rates and the ongoing challenge of saving for a deposit. Increased support in this realm could contribute to a more balanced and robust housing market.
In conclusion, the market's early-year performance reflects a positive trajectory, driven by proactive buyers and increased property choices. However, sellers are advised to approach the momentum cautiously, ensuring their pricing aligns with the budget-conscious nature of today's buyers. The upcoming budget and potential external factors could influence the market's course, and sellers must navigate this landscape strategically to capitalise on the current wave of buyer confidence.
Source: Rightmove February House Price Index
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