New Data Indicates UK Property Is a Buyers Market in 2024

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Expert Weighs in on What to Expect in the UK Property Market in 2024

Over the past year, record-high mortgage rates emerged due to soaring inflation, the Help to Buy scheme shutdown, and rising living expenses. These factors have significantly impacted the housing market.

Looking ahead, Pete Mugleston, MD and mortgage expert at Online Mortgage Advisor, shares his insights on the potential outlook for the property market throughout the remainder of 2024.

Let’s look at Mugleston’s property market analysis in more detail.

Find Out More: See our guides for information on buying a second property or the best area to invest in property.

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Mortgage Rates Should Decline

According to Mugleston, there’s a strong indication that mortgage rates will gradually decrease, which is good news for those considering buying a house. Currently, two-year fixed mortgage rates are around 5.95%, and five-year fixed rates are at 5.57%, lower than before when they were 6.85% and 6.37%, respectively.

This rate drop is attributed to a 3% decrease in inflation this year. If inflation continues to decline in the coming months, we may see further reductions in mortgage rates. However, Mugleston suggests that it’s unlikely that we’ll see the meagre rates we had previously, with his analysis expecting rates to dip below 4% at the end of 2024 or even later.

So, while buy-to-let investors may wish to wait for previously low mortgage rates, it may be worth considering jumping into the market anyway, particularly if a good investment opportunity presents itself.

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Expect a Buyer's Market for 2024

Despite the high rates, 2024 offers a unique opportunity for buyers, Mugleston says. As demand wanes due to increased costs, house prices have begun to decline as potential buyers hesitate. The Office for Budget Responsibility has forecasted a 10% decrease in house prices between 2023 and the end of 2024.

Some buyers may view this as a chance to purchase buy-to-let property investment opportunities at a discounted price.

Additionally, there’s a possibility of rents rising in the upcoming months as landlords transfer increased costs to their tenants, potentially enticing more buyers into the market to take advantage of better yields.

Continued Demand for Energy-Efficient Homes

Amidst the ongoing cost-of-living crisis, and with winter energy prices for heating homes reaching unprecedented levels, it’s unsurprising that there’s a growing demand for energy efficiency in rental and home-buying decisions. Homeowners and developers who prioritise energy-saving upgrades like enhanced insulation, high-efficiency heating systems, and solar panels can anticipate their properties being more appealing to potential buyers or renters.

For this reason, buy-to-let investors may want to consider buying off-plan property, as they will utilise these energy-efficient features and appeal to tenants who will pay higher rents.

Similarly, Mugleston expects an increase in new-build properties to play an essential role in fixing the current housing shortage supply.

For more property investment insights across the UK, consider reading our buy-to-let area guides to inform your property investment portfolio strategy, including:

New Data Indicates UK Property Is a Buyers Market in 2024