Spring Property Market Update
The Greater Manchester property market is experiencing a notable increase in the number of sales, contrasting with relatively stable house prices across the UK. This improved market is a positive change for homebuyers in 2024, provided sellers maintain realistic with pricing, and ensuring affordability remains unchanged.
In Greater Manchester specifically, increased availability of homes for sale coupled with renewed buyer confidence has driven a 12% year-on-year rise in agreed sales. This trend has persisted for the last four months, signalling a resurgence in the housing sales pipeline following a plateau in activity during the period of higher mortgage rates in 2023. Projections suggest that this area is on track for a 10% increase in sales completions in 2024, totalling around 1.1 million transactions nationwide.
We are also seeing a trend of Manchester buyers expanding their search radius in pursuit of better value rather than downsizing due to increased borrowing costs. Research indicates that a third of households looking to move are considering areas outside their local vicinity to secure their desired property.
Looking ahead, the housing market is forecasted to continue firming throughout 2024, but with no immediate acceleration in house price inflation anticipated. The trajectory of price stability and market activity will largely hinge on future interest rate movements, although current fixed-rate mortgages reflect expectations of stable rates for the remainder of the year.
Ultimately, sustained price stability is deemed essential for fostering continued growth in sales across the Greater Manchester property market and nationwide.
What's happening around our partner regions?
The property market, within both Birmingham City Centre, and its residential outskirts is seeing a noticeable growth in demand since 2023, and we would put this down to one main reason - mortgage affordability.
The higher rates in 2023 meant that for many, purchasing a home wasn’t viable, and therefore a large group of buyers were waiting for the right time to make their move.
However, after several months of high mortgage rates, the start of 2024 saw these figures begin to decrease, making mortgages much more affordable. With pent-up demand and a new better rate, those who had been waiting for most of 2023 began to enter the market at the start of 2024 in the hope they could finally secure a deal. With more buyer confidence, sellers can expect to see a greater and more diverse pool of buyers, all with an increase in the commitment to proceed with the sale.
This is demonstrated in our statistics which show that March 2024 had a surge in sold properties. So much so, it is the highest number of properties sold since 2019 which was a pre-pandemic market. This should give buyers and sellers alike the confidence that our property market is gradually returning to one that is more stable and familiar, or possibly even better than before.
In addition, the New Build market is also coming back to life. Many developers are showing their commitment to build now the market has proven more fruitful. This not only increases interest in the new build market, but also creates further movement down the chain in the re-sale market, meaning everyone can benefit.
Looking ahead, the housing market is forecasted to continue firming throughout 2024, but with no immediate acceleration in house price inflation anticipated. The trajectory of price stability and market activity will largely hinge on future interest rate movements, although current fixed-rate mortgages reflect expectations of stable rates for the remainder of the year.
Scotland has remained the fastest selling market in the UK in the first three months of 2024, with an average time on the market of 43 days, compared to the national average of 71 days. DJ Alexander outperformed these numbers by achieving an average selling time of only 33 days.
It has been a strong start to the year for sellers with the average sale price achieved in excess of home report valuations. The average sale price in Scotland during the last three months was £180,000, with the average in Edinburgh being £263,000, and in Glasgow £175,000 which indicates a 3-6% increase compared to the same period in 2022.
For DJ Alexander, and specifically in Edinburgh, one & two-bedroom properties up to around £250,000, were the highest in demand, particularly those along the new tram line extension. Properties at the higher end of the market (£500k +), have also had a strong start to the year, with a high volume of sales being achieved during Q1. We are mainly seeing this in EH4, covering areas such as Stockbridge, Comely Bank, Dean Village and Craigleith.
Across Glasgow, our sellers have had real success in Q1. In particular, we have also seen one & two bedroom flats within traditional tenement buildings achieving groundbreaking sale prices. Areas such as Finnieston, Shawlands and Dennistoun also continue to be the most attractive areas for buyers.
Overall, there has been a real uplift in market confidence in Q1 2024 as a result of the mortgage market stablising and we are seeing sellers who had paused their plans until the market became steadier, now coming to the market. With affordability more favourable, there are more first-time buyers and upsizers re-entering the market, therefore we are expecting a continued buoyant market for the rest of 2024.
It has been a strong start to the year for the sales market on the South Coast, with activity for the first 4 months showing to have been positive, when compared to 2023. We have seen an increase in demand from buyers which in turn has led to a rise in sales across the area.
We believe the key reason for this is due to the reduction in mortgage rates, which finally came after several months of unaffordability meaning many buyers ‘held tight’ in the hope we would eventually see an improvement. For many this slight decrease was enough to entice them into the market, with the aim of securing a good deal before anything changes.
With this increase in buyer demand we have also seen more stock coming to the market. Specifically on the south coast there is now 20% more property on the market for sale than this time last year. This good level of supply met with strong demand makes for a positive market and one that feels more stable compared to previous years.
However, sellers should not make the mistake of seeing an increase in demand as an opportunity to also increase their asking prices. Price sensitivity is key, with those properties being priced ‘right’ receiving strong levels of interest and subsequently landing themselves an offer and increase in the commitment to proceed with the sale.
Overall, there has been a real uplift in market confidence in Q1 2024 as a result of the mortgage market stablising and we are seeing sellers who had paused their plans until the market became steadier, now coming to the market. With affordability more favourable, there are more first-time buyers and upsizers re-entering the market, therefore we are expecting a continued buoyant market for the rest of 2024.
The market in the first four months of 2024 in Yorkshire is experiencing a notable spring back after some plateau towards the end of 2023. In particular, we can see that properties located within the suburbs of Leeds and Harrogate are in high demand and subsequently these areas are experiencing an increase in the number of sales transactions.
More specifically, the most popular property types here have been two and three bed semi-detached houses, perhaps highlighting the desire for buyers to make that second step and expand the space of their home in the suburbs of our popular towns and cities.
We believe there is one key reason for this ‘bounce-back’ which is the reduction in mortgage rates. Having faced many months of ‘unaffordable’ property purchases in 2023, there has been a build of demand which has now been ‘released’ thanks to the gradual reduction in mortgage rates. Keen buyers have been making their move in the early part of this year in the hope to secure a deal before prices subsequently increase. Specifically in our offices we have seen an increase in the number of applicants registering to buy who also have a house to sell. This indicates to us that we can expect to see an extremely busy market over the coming months, as these customers put their own home up for sale and open chains are finally completed.
Ben Thompson, Deputy CEO, Mortgage Advice Bureau:
With the Bank of England sitting on its hands again, borrowers will have to wait that bit longer for the first base rate cut since 2020. Inflation falling slower than expected has put the brakes on, with policymakers waiting for signs that the cost-of-living crisis has been shaken off - and there may be some way to go yet. Swap rates have also been choppy on BofE expectations, and it’s why some lenders have repriced in recent weeks.
Nevertheless, the picture for the current mortgage market looks a lot more positive than for much of last year. March saw an 18-month high in mortgage approvals, with new buyers pressing ahead with their plans.
Despite evidence of unrest in the market, mortgage rates have stabilised, and we expect to see more confidence from buyers as the year continues. A third consecutive month of growth in the number of new buyers is great to see, as are the lower rates being offered to those looking to remortgage or buy their first home.
What we are seeing is the market finding its feet in a new higher interest rate environment which, although higher, remains low by historical levels. We expect inflation to continue falling, but also feel there may be small bumps along the way. The trend, however, should be gently downwards.
While we thankfully aren’t in the same position as we were at the start of 2023, rates are higher than the levels homeowners fixed at two or three years ago, and repayments will still jump compared to what they have been paying. Current mortgage rates could be as good as they get, and therefore today’s new normal. There is little point in waiting for actual mortgage rates to fall much further, and therefore should feel decisive and act now if they are ready and wanting to do so.
It’s all about seeing what’s out there. For those looking to get ahead, use the time before your product end date to get ‘mortgage ready’. Have a conversation with a broker - they will not only help you to find the most suitable deal but will also find out how much you can borrow towards your ideal next home, supporting you throughout the whole process.
5 Top Tips for Selling Your Home This Spring
Spring brings with it a sense of renewal and freshness, making it the perfect time to put your home on the market. The brighter days and blossoming gardens make properties look their most inviting, and with longer days comes more opportunity to showcase your property in daylight. If you're planning to sell your home this spring, here are five top tips to ensure your property stands out and captures the hearts of potential buyers.
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