Britain’s biggest property website, Rightmove, thinks UK house prices will likely drop by 1% next year. They reckon the competition among sellers will get tougher as mortgage rates stay high.
Rightmove predicts that sellers will need to offer more competitive prices to attract buyers in 2024. They expect mortgage rates to calm down a bit but still be quite high. A year ago, Rightmove predicted a 2% drop in asking prices for 2023. Now, they report that prices are 1.3% lower compared to last year. This dip is due to soaring mortgage costs and a persistent cost of living crisis.
Rightmove keeps track of asking prices, not the final selling prices. They foresee a national decrease of around 1% in asking prices by the end of 2024. The property market is gradually returning to more normal levels of activity after the bustling post-pandemic period.
The website notes that in 2023, 39% of sellers had to lower their asking prices, up from 29% the previous year and 34% in 2019.
According to Tim Bannister from Rightmove, a 1% average drop in prices suggests another challenging year for buyers and sellers in 2024. However, there's opportunity for sellers who set the right prices to attract buyers.
Nationwide building society surprised some by announcing a 0.2% increase in prices in November compared to October, though prices were down 2% year-on-year.
Zoopla mentioned that the current market conditions favour buyers the most since 2018 due to Brexit uncertainty.
The mortgage broker John Charcol predicts that new fixed-mortgage deals might dip below 4% by mid-2024, offering relief for people remortgaging.
While average mortgage rates have been dropping since July, providing more stability, Rightmove warns that affordability remains a concern for many buyers. The Bank of England's indication that interest rates may stay high during 2024 could limit buyers' spending power.
Speak with a trusted mortgage advisor to see how this all can impact your mortgage or potential move.
