Property Market Update: December 2024

Welcome to the December edition of the Property Market Update! We've gathered insights from leading industry experts to provide you with a comprehensive view of the current market conditions.

House prices reach new heights

The housing market ends 2024 on a remarkably strong note, with Halifax reporting a new record average house price of £298,083. November saw a 1.3% monthly increase - the fifth consecutive rise - pushing annual growth to 4.8%, its strongest level since November 2022.

Nationwide's data shows similar positive momentum, reporting an average price of £268,144 with a monthly increase of 1.2% and annual growth of 3.7%.

Significantly, Zoopla indicates that all UK regions have now recorded positive year-over-year growth, with the national average at 1.5%, marking a notable recovery from the -1.2% decline seen a year ago.

Market activity shows robust growth

The property market has demonstrated remarkable resilience, with HMRC reporting UK home sales reaching 100,410 in October, representing a 9.5% increase from September's figure of 91,690.

The market is set to achieve approximately 1.1 million sales completions in 2024, 10% higher than the previous year, with projections suggesting further growth to 1.15 million sales in 2025.

Mortgage landscape continues to evolve

The mortgage market shows encouraging signs of stabilisation. Rates have decreased by 1% over the past year, with borrowing costs expected to hold steady around 4.25% for 75% LTV 5-year fixed-rate loans.

Current rates from Moneyfacts show the average two-year fixed rate at 5.39% and five-year deals at 5.09%. The Bank of England's latest figures reveal a significant uptick in mortgage approvals, with a 3.3% increase to 68,303 in October - an impressive 41% rise compared to the previous year.

Buyer and seller activity

The market is experiencing heightened activity on both sides. Buyer demand has surged 25% compared to last year, with sales agreements running 26% ahead of 2023 levels.

First-time buyers are anticipated to maintain their position as the largest buyer group. The RICS Residential Market Survey reinforces this positive trend, reporting positive new buyer enquiries for the fourth consecutive month with a net reading of +12%.

On the supply side, new seller listings are up 6% compared to 2023, though the market remains notably price-sensitive, with seller competition at its highest level in a decade.

Despite this increased competition, there's a healthy stock of homes available, supporting sustained sales volumes. The pipeline of ongoing sales is notably robust, standing 30% larger than at this point last year.

Looking ahead to 2025

While new seller asking prices have seen a seasonal decline of -1.4% to £366,592 - slightly more than the usual** +0.8% December decrease** - the outlook for 2025 remains positive. Rightmove forecasts a +4% rise in average new seller asking prices, their most optimistic prediction since 2021.

Summary

As we approach the end of 2024, the property market demonstrates remarkable strength across multiple indicators. The combination of positive price growth, increased transaction volumes, and robust buyer demand suggests a market that has successfully navigated the challenges of recent years.

While seller competition remains high and price sensitivity continues to be a factor, the healthy pipeline of sales and positive forecasts for 2025 indicate sustained market momentum into the new year.