Forecasts Reveal a Buoyant & Resilient UK Property Market in 2024
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What Can We Expect for the UK Housing Market Over the Next Year?
The UK property market’s resilience is leading to positive momentum within the sector in 2024, with investors anticipating better performance than in 2023. Recent months have brought more favourable news on house prices, rental market growth, and mortgage rates compared to much of 2023.
As such, many forecasters – such as Knight Frank – predict the buoyancy of the UK property market will persist throughout the year.
Let’s look at the 2024 property market in more detail and see what the future may hold for buy-to-let property.
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What Does Knight Frank Predict for UK Housing?
Knight Frank data reveals a robust demand for UK property, with notable positive statistics. In January, the number of property offers across the UK increased by 7% compared to last year. The agency forecasts a rise in transactions for the year, addressing one of the significant setbacks in 2023, which led to declines in property prices in certain areas.
Additionally, Knight Frank anticipates a 3% price increase throughout this year. Although the mainstream London market might restrain this growth slightly, the agency expects improved growth figures in the subsequent four years.
Property investors may want to turn their attention to the Savills Residential Market Forecast to know which areas could see the most significant capital growth in the next few years. The most recent forecast shows that regions such as the North West and North East should see capital growth exceeding 20% by 2028.
Find Out More: See our guide on how to build a property investment portfolio for more information on purchasing properties in 2024. Alternatively, visit our guide on the best places to invest in property.
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How Are Rates Affecting the UK Property Market in 2024?
Many experts projected five Base Rate cuts by the Bank of England in 2024. However, Knight Frank said financial markets had revised their forecast to three. The stronger-than-expected wage growth, reaching 6.2% in Q4 2023 in the private sector, has contributed to higher inflation and influenced this adjustment.
Knight Frank predicts that the current rate of 5.25% will likely remain the same in the next two Monetary Policy Committee meetings. The expectation is that when rates eventually decrease, lenders will follow suit, providing relief for borrowers nationwide. However, mortgage rates have still declined over the last six months as lenders become more confident in the UK economy.
Knight Frank also highlighted that the mortgage market offers no alarming signals presently, with HSBC declaring gross mortgage loans of £23bn in 2023.
For property investors, Moneyfactscompare’s latest data reveals that buy-to-let mortgage rates are at their lowest since mid-2022, offering a positive outlook for this segment of the UK real estate investment market.
Discover More: If you want more buy-to-let insights, check out our guide on Liverpool investment property.
What Did Knight Frank Say About the UK Property Market’s 2024 Chances?
Head of Country business at Knight Frank, James Cleland, expressed optimism in the UK property market: “The signs are positive, and demand indicators are moving in the right direction as we approach the spring market. Many buyers remain cautious about the broader economic environment, and, as the last two months have reminded us, realistic pricing is crucial.”
In addition, Rory Penn, heading London sales at Knight Frank, observed that while the UK property outlook was robust towards the end of 2023, the beginning of this year has been “slower out of the blocks than anticipated.”
He added: “The signs are pretty clear, though, that this year will be stronger than 2023, with offer levels increasing and buyer sentiment improving.”
If you want to see some of our buy-to-let area guides, check out some of the following pages:
Forecasts Reveal a Buoyant & Resilient UK Property Market in 2024
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