This month, the property market is bursting with renewed activity. More homes have become available for sale, and more buyers have come into the market. As winter finally gives way to spring, it’s the ideal time to explore the opportunities available to buyers and sellers in the housing market of 2024.
Is this a good time to buy a home?
Zoopla notes that January saw a year-on-year increase of 12 per cent in buyer numbers while the percentage of homes listed rose by 20 per cent. It’s a timely reminder that the London property market seldom slows down for long.
Despite the challenges of soaring inflation, rising mortgage rates and a hike in energy bills, house prices in north east and south east London have either dipped a little, remained steady – or, in some cases, even grown. Our Ilford estate agents are quick to point out the contrast with central London districts such as Kensington and Chelsea, which saw values fall by 10 per cent.
As wages continue to rise and inflation falls, property pundits are predicting that house prices in 2024 will continue to stabilise, although a drop in the mortgage rate looks unlikely in the near future.
If you are looking to sell your home in 2024, the best advice is to make sure it is realistically priced to sell.
Will mortgage rates go down in 2024?
When inflation rose during 2022 and 2023, the Bank of England responded by increasing the base rate, which affects the cost of mortgages. The rise was actioned to manage inflation levels, but as the rate increased from a historically low 0.1% to 5.25 per cent, homeowners with mortgages were hit hard.
The base rate has remained at 5.25 per cent since August last year, but the cost of home loans has been falling since that time. The average two year fixed mortgage rate is now just over 5.5 per cent: a big change from the peak of 6.86 per cent recorded last summer.
Inflation is now down to four per cent, but the Bank of England wants to see it fall to just two per cent. Economists predict that this target could be reached before the summer. However, political tensions in the Middle East and elsewhere could mean that the Bank’s ever-cautious directors will be reluctant to cut the base rate any time soon.
In its latest Monetary Policy Report, the Bank of England suggests that the base rate may remain at 5.25 per cent until the autumn, after which it will be slowly reduced, until it falls to 4.25 in late 2026.
What are the prospects for first time buyers?
The London Evening Standard has described 2024 as “The year to buy – if you can”.
The red-hot sellers’ market of 2021/22 has now turned into a buyer’s market, giving first-time buyers more opportunity to step onto the property ladder. First-timers will also benefit from the increase in properties available for sale, as increased competition often allows more flexibility around price negotiation.
Following a raft of mortgage rate cuts by major lenders, most high street banks are now charging less than five per cent on a five year, fixed rate deal. Recently, we have seen a flurry of fixed rate deals available at under four per cent, and that’s great news for first time buyers. As always, mortgage-dependent buyers who can offer a larger deposit compared to the value of the property (known as “loan to value”) can expect the best deals.
With house prices remaining more affordable – at least for the immediate future – there is renewed optimism amongst first time buyers. This could be a good time to purchase a property, provided you can manage the mortgage payments.
Where should I start my property search?
Properties in north east and south east London continue to provide fantastic value for money. These areas offer good connectivity to the city and beyond. Lifestyle benefits include access to green spaces, open spaces, great culture and leisure facilities, and excellent schools.
Commuting journey times from east London are exceptionally fast. Our Wanstead estate agents point out that it takes just 17 minutes to drive or travel by tube from Wanstead to central London. In Ilford, the Elizabeth Line has drastically cut journey times: it now takes just 23 minutes to travel from Ilford to Liverpool Street Station.
If you want more local information, take a look at our area guides (located under Sales in the dropdown menu). Our helpful sales teams specialise in north and east London property and are always happy to chat through the options. So why not get in touch and share your home moving plans with us?
Give us a call at 0203 972 7341 or email info@oaklandestates.co.uk.
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