The UK housing market is experiencing its highest supply of homes for sale in eight years, according to Zoopla. This increased choice for buyers is expected to keep house prices steady for the rest of 2024.
Sales are increasing but not as quickly as the growth in available homes. The supply surge, driven by a rise in three and four-bedroom homes, has seen the average estate agent office listing 31 properties, up from 26 last year.
Although many homes are new to the market, 31% were previously listed in 2023. Higher mortgage rates initially weakened demand, but homeowners are now more confident in selling.
This influx of homes is expected to maintain price stability throughout 2024, despite a 13% year-on-year increase in sales.
In the South West, the number of homes for sale has grown by a third compared to last year. Tax and planning changes affecting holiday lets and potential double council tax for second homes are significant factors contributing to this increase.
The upcoming general election in July is anticipated to have a modest impact on the market, with 392,000 homes currently in the sales pipeline.
While some buyers may delay decisions, strong motivations to move are likely to keep sales activity steady, although the total number of sales for 2024 could fall below 1.1 million.
A continued north-south divide in house price growth is evident, with Southern England experiencing modest price declines.
Cities like Belfast, Burnley, and Bolton see the strongest price growth, whereas Ipswich, Hastings, and Norwich see the most significant falls. This disparity is due to affordability issues exacerbated by higher mortgage rates.
Richard Donnell, executive director at Zoopla, said: “The growth in the supply of homes for sale is evidence of renewed confidence amongst homeowners, some of whom delayed moving decisions in 2023.
“The quarterly rate of house price inflation has picked up in recent months as more sales are agreed and prices firm.
“The announcement of the election will slow the pace at which new sales are agreed while greater choice for buyers will keep house prices in check over 2024. It’s essential that those serious about moving in 2024 price their homes realistically if they want to achieve a sale.”
Nathan Emerson, CEO of Propertymark, added: “It’s extremely positive to see such a sizable uplift in the market across the last twelve months.
“However, with a general election now confirmed, until there is full clarity on the direction any new Government intends to take regarding housing, we expect there to be a temporary slowing across the summer months of both people choosing to sell their property and those actively looking to buy.
“We do have the positive news that inflation is now firmly tracking downwards and would be keen to see interest rates follow. We are hopeful across the coming months that lenders will bring both competitive and targeted deals to the marketplace at the first opportunity.”
