Recovery in the residential market
Recent data indicates that the residential property market is continuing to recover.
According to TwentyCi, in the period from June to August 2024, sales agreed were only 1% lower than pre-pandemic levels. Promisingly, the number of new property listings was up 3%, indicating growing confidence among sellers. Meanwhile, Bank of England data shows that there were 62,000 mortgage approvals in July. While this is only a marginal increase, it is the highest number seen since September 2022. Although inflation rose by 2.2% in the 12 months to August, core inflation continues to moderate and experts expect further cuts to Bank Rate in the coming months, which would make the future a little brighter for borrowers. Affordability is already starting to improve, according to Savills, who stated that the headline quoted cost of a five-year fixed mortgage with Nationwide had decreased to 3.94% at the end of August, having been 4.5% at the end of June.
Rents starting to fall
The UK has passed peak rental inflation, according to data from Zoopla.
For the past three years, rents have been increasing at a faster pace than earnings. Renters will be relieved to learn that, in the last six months, rents increased by only 1.6% – the lowest rise since 2021. It is predicted that, by the end of 2024, rents for new lets will have gone up by 3 to 4%. So, while tenants may still be feeling the pinch, it is a significant improvement on previous years, as 2023 and 2022 saw rents go up by 8% and 11% respectively.
Click link for Residential Property Review – September 2024 –
