Early 2024 Buyers Boost Housing Market, But Price Sensitivity Remains

26th February 2024

We’ve seen some positive activity in the property market in the past couple of months. Buyer activity is busier than this time last year, and January was a record-breaking month for people requesting home valuations.

What happens in the first couple of months of the year is often a good indicator for the year ahead. A year ago, we were seeing a much cooler market than usual. With mortgage rates at historically high levels, many home-movers put their plans on hold.

But by the end of 2023, mortgage rates were edging down consistently, and a record number of homes were listed for sale on Boxing Day.

While these were all positive signs, it wasn’t clear whether housing market activity would keep its momentum into March. We’re able to see what’s happening in the property market in real time, and can see that this increased level of demand has remained, with lots of people determined to make 2024 the year they move into a new home.

Rightmove property expert, Tim Bannister, says: “There continues to be reasons for cautious optimism as we settle into 2024, with encouraging activity levels from home-movers and a more stable housing market. While some would-be buyers will continue to be affected by elevated mortgage rates and major affordability constraints, many other prospective buyers who can afford to do so, have acted fast and demonstrated their belief that 2024 is their year to get moving.”

These elevated activity levels are translating into 7% more properties coming onto the market than at the same time last year, and the number of buyer enquiries to estate agents has also seen a 7% increase compared to 2023. And this is all converting into the number of agreed sales in the first six weeks of 2024 being 16% higher than over the same period last year.

Tim adds: “Early-bird Boxing Day buyers got a head start in cherry picking from a record level of new properties listed for sale and have now been joined by many other buyers also believing that 2024 offers the right market conditions to move. Mortgage rates have fallen considerably from their peak and are now remaining broadly stable after the uncertainty of late 2022 and 2023.”

What happened to house prices this month?

New seller asking prices have seen an annual increase for the first time since July 2023, taking the average to £362,839 (+0.1%). And though a small rise, stable asking prices are a sign that sellers aren’t feeling the need to come to market with a lower asking price in order to find a buyer. And we’re not seeing a trend of forced sales, as a result of elevated mortgage rates.

We’ve also seen a month-on-month price rise (+0.9%) in line with what we normally see at this time of year.

How much are average house prices?

Our monthly House Price Index tracks the national average house price, and changes over time. You can also check the trends in your local area, as well as how long it’s taking for homes to sell right now.

A ‘two-speed’ housing market

While activity levels have picked up, we’re still seeing buyers only willing to move if they find a property that’s right for them, and at the right price.

The housing market appears to be operating at two-speeds. Some sellers coming to market with too high an asking price are ending up needing a reduction later.

Sellers who price right first time are seeing their homes sell the most quickly, without the need for a reduction, to be able to secure a buyer.

It’s also taking considerably longer for homes to find buyers than we’ve seen over recent years: over two weeks longer than during the same period last year.

Tim says: “Momentum to move in 2024 is continuing to build, but prospective sellers mustn’t get carried away. Buyers now have more choice of property for sale and many are still very price-sensitive, with mortgage rates remaining elevated. Sellers who are serious about moving this year would be well-advised to ride this wave of increased buyer confidence with an attractive asking price.”

What does this mean if I’m thinking of moving in 2024?

If you’re thinking of moving soon and are curious to know how much your home is worth, you can get an instant valuation to give you a quick estimate.

But when your home is ready to be listed for sale, a local expert agent will be based-placed to give you an in-person, accurate valuation. You can do this by requesting an agent valuation here.

And setting the right asking price will be key. Kate Eales, deputy head of residential at Strutt & Parker, says: “Motivated sellers need to be realistic with listing prices and take advice on how to effectively position their sale in the current market. Buyer’s budgets are still being largely constrained by expensive mortgage products, so it’s a careful balance.”

What could happen next?

The government’s spring budget announcements are taking place on 6 March, which could include policy changes that will affect some home-movers.

Tim says: “It’s still early days for 2024, with a Budget, General Election and no doubt more global events still to play out. Rightmove’s whole-of-market data shows that it’s the first-time-buyer segment who could use the most support this spring, and well-thought-out initiatives to help to get more would-be first-time buyers onto the ladder would be welcome.”