18 January 2024 – If Rightmove’s recent data is any indication, 2024 is looking to be a promising year for the UK property market. At 1.3 %, we’re seeing the most significant December to January house prices jump since 2020!

For January, the average price of a property entering the market rises to £359,748— more than double the 20-year average of +0.6%. 

Listings outpace buyer demands

The number of properties marked for sale also rose to 15% higher than last year, following a record-breaking number of sellers registered after Boxing Day, Rightmove‘s latest House Price Index suggests.

Despite the surge in listings, the number of presently available properties barely exceeds the 2019 normal market levels at 1%. 

The average stock per estate agent is 49, including properties marked Under Offer and Sold STC. In reality, the listings still surpass the number of enquiring buyers. 

For those who want to sell their properties effectively, the answer lies in competitive pricing. This sentiment is reflected in average asking prices for new sellers at 0.7% lower than last year.

For December 2023, the national average for the days it took to secure a buyer was 71. At 78 days, London sellers take a week longer on average to successfully close a sale.

These numbers contrast with the data from December 2022, with 52 and 67 days for the national and London average, respectively. 

The discrepancy between increased buyer interest and market availability may be due to the seasonal house prices jump, mortgage rates, and cost of living— all factors that limit spending capabilities, especially for first-time buyers.

First-time buyers may prefer to rent than buy

Renting is looking to be a more feasible option rather than owning a home for first-time buyers. A comparison of the average monthly mortgage payment with a 10% deposit versus rent of the same property type revealed a significant difference.

The average mortgage payment sits around £1,250 compared to the equivalent monthly rental rate of approximately £1,000 for the same property. The lack of overlap between the two may continue to drive the divide between potential buyers and sellers. 

Rightmove also ascertained the affordability of buying a first home between a single buyer and a dual-buyer income. 

With the average asking price as a basis, a one-person salary can’t afford a first-time buyer home based on January 2024 prices.

Increase in buyer interest compared to January 2023

Don’t worry. It’s not all bad news for sellers! This time, the number of sales agreed to is 20% higher in the same period as last year. 

It’s definitely a sign of buyer confidence returning after the fiasco that was the post-mini-Budget period.  

Compared to the first week of 2023, enquiries from potential buyers to estate agents are also 5% higher— activity recorded at its highest in London and the North East.

A closer look at borough data disclosed that average prices, from the past three months, recorded mostly negatives in monthly changes. 

Kensington and Chelsea sit at the lowest with -4.9% and an average price of £1,630,229. These reductions may explain the returning interest of urban homeseekers to the property market.

Nevertheless, Rightmove asserts these data points are indicators for trends for each borough and do not reflect London’s overall monthly numbers.

On the other hand, regional data revealed that most regions recorded a rising trend compared to the previous months. The South East logged a 2.4% monthly house price jump and an average asking price of £466,698.

Mortgage in Principle users at an all-time high

Another indicator of an uptick in buyer activity is Rightmove recording a surge of individuals availing the Mortgage in Principle since December 27th. 

As a guide, buyers determine the amount they can borrow from a lender and the type of home they may afford. 

Since its launch in 2022, Rightmove predicts January as the busiest month yet for the service.  

The property website also recorded the average 5-year mortgage rate at 4.86%. Coupled with an expected Base Rate cut, the first since 2020, and best-buy rates skirting towards 4%, these indicators may reflect a less volatile mortgage market compared to 2023.

All in all, the property market is seemingly looking up for sellers and agents. With the house price jump and an increase in buyer activity and interest, it’s an optimistic start for 2024. 

There may still be a bit of hesitation, especially in first-time buyers. But as long as sellers employ realistic price expectations, it’s not impossible to close a sale quickly. 

Our Opinion

The new year is a time for change for many, which often means it’s time to move. The property market normally gets an uplift from Boxing Day onwards. So Rightmove’s data regarding demand on that day is a good indicator of what kind of activity can be expected in the coming spring.

However, the portal’s figures also show that affordability is still a challenge. While mortgage rates are on a downward trend, they are still much higher than three years ago.

January has seen house prices jump again, which isn’t good news for many first-time buyers, as they will struggle to afford to get onto the property ladder.

While rents are still at record highs, it’s still cheaper than buying a home. This leaves many first-time buyers with a problem. And it shows once again that there is a lack of affordable housing in this country.

The moderate fall in house prices in 2023 won’t be enough to balance out the huge house price increase we have seen during and just after the pandemic. Unless the government steps in, owning a home becomes an impossible dream for many young people.