
There has been a 25% rebound in sales activity in response to the slow recovery of the mortgage market, which now boasts the lowest mortgage rates for 15 months, the latest House Price Index from Zoopla has revealed.
According to Zoopla’s findings, sales agreed and buyer demand were both up by more than a quarter over the past four weeks compared to the same period a year ago.
The number of sales agreed were up to 30% higher across the East Midlands and North-East.
The number of homes for sale continued to grow as greater confidence amongst sellers saw more homes listed for sale – this includes homeowners looking to move as mortgage rates fall but also investors and second home owners selling in response to possible tax changes.
A third (32%) of homes for sale on the site were ‘chain free’ as investors and second home owners look to sell homes amidst recent tax changes and speculation around further tax changes in the upcoming October Budget.
The most common ‘chain free’ homes were two bed houses, with 41% of this house type currently listed as chain free on Zoopla.
In addition the Index revealed that affordability continued to be a constraint on house price growth, especially in Southern England.
London prices have registered the biggest turnaround over the last year moving from annual price falls of -1.7% a year ago to modest price gains of +0.5% today.
Whilst house prices were lower than a year ago in the South West, South East and Eastern regions of England, in the rest of Great Britain, house price growth was higher than a year ago with prices up to 2.5% higher.
Home values in Northern Ireland were also 5.5% higher, having under-performed the rest of the market in recent years.
Over a third of sales (37%) were being agreed at more than 5% below the initial asking price, highlighting further how buyers continue to be competitive with offers.
This proportion has improved from a year ago but remains at a level that suggests low single digit house price growth ahead.
Richard Donnell, executive director at Zoopla, said: “Lower mortgage rates are delivering a much needed confidence boost to homeowners, many of whom have sat on the side-lines over the last two years.
“Market activity is up across the board and expectations of lower borrowing costs will continue to bring buyers and sellers into the market.
“Speculation over possible tax changes in the Budget and the impact of previous tax changes are continuing to add to the growth in the number of homes for sale.
“We remain in a buyers’ market and greater choice of homes for sale will keep house price inflation in check into 2025.”
Nathan Emerson, CEO of Propertymark, added: “It’s positive to see further growth within the housing market. 2024 has been a year of progression that has seen changes within the wider economy help uplift the ability for people to approach the marketplace with a new level of assurance.
“We are starting to see early signs of lenders having the confidence to shift up the landscape by offering sub-4% mortgage deals in some circumstances, which of course sits firmly below the current base rate and points towards future confidence within the economy.”
Article In The Intermediary - Jessica O'connor
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