The UK housing market is showing signs of recovery, with a jump in both the volume of people looking to buy a home and higher numbers considering a sale.
Recent reports indicate an improvement in confidence about the outlook for property prices after mortgage rates eased from a 15-year high last year, and yet the signs are that house prices will fall in 2024.
A number of reports have suggested that house prices will continue to drop, which could result in more would-be-buyers finally get on the housing ladder, even if this negatively impacts those who already have property, and want to see its value continue to increase.
Zoopla is the latest company to maintain its predictions of a decline in house prices this year. The property portal projects that the average price of a home in the UK will drop by an average of 2% in 2024, led by falls in southern England.
Almost a fifth of homeowners in the East of England and the South East registered home value decreases of 5% or more last year. The average loss for this group of homeowners in the East of England was £11,500, while those in the South East lost an average of £13,200, according to Zoopla.
A recent report from portal underscores the ongoing challenges of affordability, especially for mortgage-reliant households, even as mortgage rates start to edge lower.
With market activity stabilizing and pricing becoming more aligned, the outlook for 2024 suggests a continued, albeit modest, adjustment in the UK housing market.
Izabella Lubowiecka, a property researcher at Zoopla, commented: “While national house prices indices pointed to modest house price falls over 2023, our property by property level tracking of home values shows that most homes saw their value unchanged or slightly higher over the year. Value reductions were focused in southern England while modest gains were recorded in lower priced, more affordable housing markets.”