According to Rightmove statistics, the year has started positively for property investing. In January, there was a 13% increase in new properties for sale compared to last year, and estate agents are receiving 7% more enquiries from potential buyers.
This correlates with the latest RICS survey, which indicates improvement across multiple sales metrics in the property market, noting an uptick in buyer demand, agreed sales, and new instructions.
A promising indication of people preparing for the year is the growing number of individuals initiating the Mortgage in Principle process on Rightmove to assess their borrowing capacity. January marked the busiest month for this service since its launch in 2022.
The average home asking price in Great Britain has climbed to nearly £360,000 per Rightmove data. Despite this, the figure remains lower than the same period last year. This suggests that new sellers are being realistic about pricing as the market recovers from the impact of historically higher mortgage rates. This is a continuation of the trend seen towards the end of last year when sellers applied considerable discounts to their properties before Christmas to push through a sale.
These figures suggest that affordability is slowly coming back to the market. With inflation falling to 4% and expected to reach the 2% goal the Bank of England set before the summer of 2024, we may see mortgages become more affordable in the next few months and more people buying an investment property.
While it is too early to suggest interest rates will come down, the latest MPC meeting saw the Bank of England hold interest rates at 5.25%. At the same time, one member voted to reduce rates, a sign that forecasters are growing more confident in the market. It is important to remember that mortgage lenders adjust their prices based on forecasts rather than the current interest rates. With property market predictions cautiously optimistic for 2024 – Knight Frank predicts a 3% rise in property prices – the average mortgage rates will likely continue to fall in the coming months.
Take a look at our recent buy-to-let area guides for more information surrounding the UK rental market:
UK Property Market Sees Record Number of Home Valuations
