It's a well-known fact that the property market is driven by sentiment which can be easily influenced by the media, the bugbear of many estate agents!
As humans we tend to follow the pack and we see this in the property industry all the time.
Just look at the covid pandemic, the Government released the shackles of the UK population when it came to buying property by removing the need to pay stamp duty for a set period of time. This brought buyers out in their droves and the overriding majority of these people were what we would describe as discretionary movers. They had no distinct need to move however wanted to benefit from the ‘savings’ they could make on stamp duty. Once one person engages in such an activity you then tend to see other people follow suit.
Similarly in the weeks and months that followed the dreaded “mini budget” (won't that go down in history!) influenced by the negative news stories that followed, many home movers put the brakes on their plan and battened down the hatches see how the market unfolded.
When it comes to purchasing a property the biggest winners are always those that get ahead of the curve when there is an uplift in market activity.
You can see exactly why; when more properties come to market and there are less buyers in the market, prices reduce.
However, as these properties start to sell (creating positive sentiment), more buyers enter the market and before you know it, the pendulum has swung and demand is then outstripping supply. Basic economics then mean that prices go up.
So as I write this article at the start of the third week of January, what is the outlook for the next few months?
Well instead of looking into my non-existent crystal ball, let’s consider the facts:
- In just three weeks, Hat and Home buyer registrations are up by 330% year on year and increasing by the hour. We have already registered more prospective buyers in January than in the whole of January, February and March 2023!
- Major mortgage providers have already announced significant rate drops and most well-known High Street banks have already followed suit as they battle for business.
- Rightmove have reported that so far this year, the number of new properties coming to the market for sale is 15% higher than the same period last year and even more positively, the number of sales agreed is 20% higher than during the first week of last year.
- On the 20th December 2023 it was announced that in November inflation was 3.9% down from 4.6% in October.
So what does this all mean?
Positive sentiment!
After what many have described as a turbulent year in the property market the green shoots of recovery are clearly starting to flourish. As a buyer this only means one thing, more competition!
More competition means paying a higher price in a tougher negotiating environment where the idea of ‘haggling’ starts to dissipate.
For upsizers one of the benefits of a declining market is that the physical cost of moving reduces as the gap between selling and buying lessens. It would appear that these days are now gone. As activity increases and competition starts to rise naturally the differential starts to go up.
So in summary, if a property purchase is on the cards in 2024 whether it be for investment, a larger family home, releasing some equity, or getting your foot on the property ladder for the first time then you should waste no time in taking action!
To secure the best property, get yourself in an attractive position:
- Truly understand your borrowing power by speaking to mortgage advisor
- Have funds available whether that be cash to invest or by having your current property under offer
- Register with estate agents so you can be made aware of properties before they hit the open market
At Hat and Home and Milliner Financial Services we can help with all of this!
So, if you are considering selling or buying in 2024 please get in touch!