29 February 2024 , 09:04
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The property website Zoopla has reported a 15% increase in house sales compared to the same time last year, as mortgage rates begin to drop.
It found that agreed sales have risen due to an 11% increase in buyer demand and a 21% rise in homes for sale compared to last year. The survey, which covers the four weeks up to February 18, revealed that house prices have only fallen by 0. 5% compared to the previous year.
This is a significant decrease from October when prices dropped by an average of 1. 4% across the UK. Zoopla's executive director, Richard Donnell, said: "The housing market has proved very resilient to higher mortgage rates and cost of living pressures."
He added: "More sales and more sellers shows growing confidence amongst households and evidence that 4-5% mortgage rates are not a barrier to improving market conditions." He also noted that the momentum in new sales has been building for the last five months and the sales market is on track for 1. 1m sales over 2024 supported by new sellers coming to the market.
However, he warned: "While sales are set to increase we don't expect house price growth to accelerate further in 2024." Zoopla expects to sell approximately 10% more homes this year than in 2023.
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Despite the anticipated cut in the Bank of England's base interest rate later this year, Zoopla advises borrowers to still expect 4% to 5% rates for much of the year. Zoopla reported that areas in southern England, outside of London, have seen the largest annual price falls in the country.
The average home now costs £344,000 in the area, which is 30% above the UK average. In London, the average house price is a whopping £534,000. However, Zoopla noted that affordability in the capital has been slowly improving over the last seven years.
Across the rest of the UK, the growth in house prices has slowed significantly over the past year. But in areas where house prices are at or below average, prices haven't generally been dropping. In these areas, "the impact on buying power from higher mortgage rates has been less pronounced", Zoopla explained.