Housing market activity has improved across key measures in the first quarter (Q1) of 2024, including sales activity, house price growth and the supply of homes for sale, according to Zoopla’s monthly House Price Index.
New sales agreed were 9% higher than a year ago, with 7% more home sales agreed over Q1 2024 versus Q1 2023.
This trend encouraged more sellers to list their homes for sale, with 20% more homes for sale compared to this time last year.
The strongest growth in sales activity was in areas with more affordable house prices such as Yorkshire and The Humber (+11%) where the average house price was £185,600 and the North West (+13%) with an average house price of £194,500.
The strongest growth in new sellers listing homes was in the South West (+28%) and North East (+26%).
Further evidence of improving market conditions was found in the narrowing in the discount between the asking price and the agreed purchase price – which is now in line with the pre-pandemic average.
The average discount from asking price to agreed purchase price has narrowed from 4.5% last November to 3.9% in March 2024, the lowest level since July 2023.
This equated to a £10,000 discount compared to a £14,250 discount in November.
Richard Donnell, executive director at Zoopla, said: “Rising wages and falling mortgage rates have boosted consumer confidence and this is feeding into improving levels of housing market activity over the first quarter of 2024.
“House prices are falling at a slower rate but it remains a buyers market where there is much greater choice of homes for sale.
“We don’t believe that house prices are about to increase more quickly but there is more buyer interest.
“Sellers need to remain realistic on where they set the asking price if they are to take advantage of improving market conditions to secure a sale and move home in 2024.”
Marc von Grundherr, director of Benham and Reeves, added: “While we’re yet to see interest rates fall there’s no doubt that the certainty brought about by a continued freeze has helped to improve market sentiment considerably.
“Despite the disappointment of the Spring Budget, buyer confidence is building and there remains a strong appetite to transact in 2024.
“Of course, the higher cost of borrowing remains an obstacle, but one that buyers are now willing to tackle with the expectation that rates will fall at some point this year.
“For sellers, this has resulted in an increased level of interest and we’re also seeing a strong uplift in the number of offers being submitted.
“Previously, the ability to find a buyer in a proceedable position was a challenge in itself and so there’s no doubt that market conditions have improved in this respect.”
He concluded: “Price remains the key compromise for sellers when it comes to securing a buyer in today’s market, with higher mortgage rates continuing to restrict buyer purchasing power.
“However, the gap between this purchasing power price point and seller asking price expectation has narrowed and we’re finding that sellers are more than happy to oblige in order to make their move.”
