Looking back over 2023 reveals a pivotal year marked by post-pandemic adjustments. The housing market witnessed notable shifts, with escalating interest rates and a cost-of-living crisis contributing to incremental decreases in house prices throughout the year.  According to the Nationwide House Price Index, the average UK home cost £259,423 in October 2023, reflecting a 3.3% decline compared to the previous year.  However, there was a 0.9% increase from September, highlighting the dynamic nature of the market.

 “The housing market did not experience the crash that many had predicted for 2023”.

In contrast, the UK House Price Index, utilising Land Registry data, showed a modest 0.2% price increase in the year leading up to August 2023. Notably, Nationwide’s assessment, based on mortgage approvals, suggested a 5.3% price decrease in the same period.


“It’s clear that the sharp upward trajectory in prices we’ve grown used to over the past few years has been curbed, but thankfully we have not seen a crash in the housing market that many predicted for 2023” Tom Henshaw MNAEA, Managing Director.


Predictions for 2024

Looking ahead to the 2024 property market, indications suggest a continued decline in house prices. This trend is closely tied to persistently high-interest rates and mortgage costs expected in the next 12 months, making mortgages less affordable and constraining the purchasing power of many buyers.


However, potential wage increases could partially offset this, bolstering buyers’ budgets and mitigating price drops. This contributes to forecasts indicating that price declines will likely remain relatively modest, staying in the single digits – defying earlier predictions of a housing market collapse exceeding 10% or more in 2023.


The consensus among property experts leans towards a scenario where property prices either remain stagnant or experience moderate declines in 2024, setting the stage for a potential resurgence from 2025. This aligns with the Bank of England’s anticipated attainment of its 2% inflation target, promising slower increases in the cost of goods and services, more disposable income, and the prospect of lower interest and mortgage rates.

What about First Time Buyers?

In 2023, despite high mortgage rates, first-time buyers (FTBs) made up a record 28% of transactions in Great Britain. While some FTBs avoided rising rents, increased borrowing costs have hindered others from entering homeownership. The outlook for 2024 may not bring better fortune, as lower mortgage rates could heighten competition for smaller properties, and overall rates or prices are unlikely to drop significantly. This suggests that 2023 might represent the peak for first-time buyer transactions.


Remaining positive!

As we transition into 2024, it is imperative to emphasise that the demand for housing in the UK continues to show resilience, especially given the trend where rents are surpassing the incremental rise in mortgage costs across many regions. Despite optimism among sellers, as reported by Rightmove citing increased asking prices in 2023, homes are taking longer to sell, with the number of agreed sales lagging by 17% compared to October 2022—a period marked by pandemic-induced buying frenzies.


As we approach 2024, sellers poised for success will be the ones heeding the guidance of expert estate agents, strategically pricing their homes from the outset to draw in a broader array of potential buyers.


If you’re considering a move in 2024, Get in touch. 

Call our dedicated team at Henshaw Fox and schedule your free home appraisal today.

Find out more: https://henshawfox.co.uk/sell/

Call: 01794 521339

Email: homes@henshawfox.co.uk

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