Following the latest Halifax HPI Data that saw the average house price rise by +1.1% in December, industry experts have shared their thoughts with IFA Magazine.
Matt Thompson, head of sales at Chestertons, says: “December tends to be a quieter time of year in terms of property transactions but, last month, buyers have been more motivated to continue their search. Pent-up demand caused by last year’s economic uncertainty has been a key reason for this spike in buyer activity and indicates that 2024 will see a rather active property market.”
Nathan Emerson CEO at Propertymark comments: “It is positive to see that house prices have gone up gradually month on month and also year on year, especially as borrowing costs are being affected by higher interest rates on mortgage affordability.
“Before 2023 ended, the Bank of England’s decision to maintain interest rates should be providing further confidence to buyers looking to make their next or first home move in 2024. We would now hope that the the Bank of England gradually starts slashing interest rates in order to further to stimulate growth in the housing market.”
Foxtons CEO, Guy Gittins, commented: “The latest figures provide further proof that despite a tough year, the UK property market has seen 2023 out on the front foot, recording a third consecutive monthly increase in the rate of house price growth and finishing the year with positive annual growth.
“This growing positivity has no doubt been bolstered by the resulting stability of a freeze on interest rates and the market is now poised for what we expect to be a much better year.”
Tom Brown, Managing Director, Real Estate at Ingenious, said: “The UK property sector continues to demonstrate its resilience and popularity in the face of high inflation and higher borrowing rates. Nationally, there remains a significant shortage of housing inventory across most locations and price points. Consequently, any slow-down in sales volumes from homeowners is likely to be offset by increased demand from renters and investors.
“However, it’s essential to note that the situation is not uniform throughout the country and across all price ranges. When analysing opportunities, it is key to understand the underlying subsectors and regional dynamics. Taking too broad a view of the market can be misleading. For instance, the institutional housing sector has experienced fewer disruptions compared to the residential sector due to its long-term investment horizon, rental growth and substantial capital inflows.
“2024 brings a new and exciting set of challenges and opportunities for growth and progression in what we do. We are looking forward to continuing to work with borrowers and investors and delivering for them. The dynamic landscape of the markets that we serve, and the wider economy requires us to evolve to stay relevant in addressing diverse challenges including the climate crisis, and changes in the way we are all living. 2024 will see Ingenious broaden the reach of our widely embraced development lending product. This expansion aims to offer extended terms for stabilisation to specialised developers within the rental sectors. Additionally, special lending terms will be introduced for developers with a specific focus on minimising embedded carbon in their construction practices.”
CEO of Yopa, Verona Frankish, commented: “While monthly house price growth is widely considered too erratic a measure to demonstrate improving market health, there’s now no doubt that the market is heading in the right direction.
“Not only have house prices climbed for three consecutive months, but both the quarterly and annual rates of growth have also increased despite an extremely testing year for the market.
“With rates currently frozen and expected to fall, we simply don’t anticipate the market to decline in 2024 having already weathered the worst of the storm.”
Director of Benham and Reeves, Marc von Grundherr, commented: “A clean sweep of positive house price growth in December could be considered somewhat of a Christmas miracle given the turbulent year 2023 turned out to be.
“However, those of us on the front lines have been observing a growing level of market momentum for some months now and so it was always a question of when, not if, this started to boost market health where house price growth is concerned.
“The property market has once again demonstrated its resilience in the face of economic uncertainty and while challenges still remain, you’d be ill-advised to predict a fall in property values over the coming year just a few short days into January.”
CEO of Octane Capital, Jonathan Samuels, commented: “A freeze on interest rates has certainly helped to steady the ship and not only have we seen mortgage approvals start to climb, but house prices are now starting to follow suit.
“With the base rate remaining at its highest since 2008, we’re not yet out of the woods, but we can now see the light through the trees and it’s difficult to anticipate anything other than further positivity on the horizon in 2024.”
Karen Noye, mortgage expert at Quilter: “Figures from Halifax this morning reveal house prices saw a monthly uptick of 1.1% at the end of 2023, the third consecutive monthly increase, resulting in a 1.7% increase year on year. House prices consistently defied expectations that they would plummet throughout 2023, and this uptick highlights just how resilient the housing market has been over the last year despite the volatility it has faced.
“As we look ahead to the rest of 2024, the housing market turmoil seen over the past couple of years is expected to dissipate further. Many lenders have been reducing their mortgage rates as swap rates have lowered, and lower transaction levels have prompted a healthy competition between lenders vying for business. This could lure prospective buyers back to the market and further prop up house prices. Figures from the Bank of England released just yesterday echo this, as net mortgage approvals for house purchases rose from 47,900 in October to 50,100 in November showing demand is making a slow return to the market.
“2023 was an incredibly tricky year for the housing market as high interest rates and cost of living pressures saw many put house purchases on hold, but it appears to have weathered the storm well. Though Halifax has predicted a fall in house prices of between -2% and -4%, the overall outlook for 2024 remains relatively optimistic. Affordability will still be challenging this year given higher interest rates, but a reduction in mortgage rates has already started to materialise and those looking to secure a fixed rate mortgage may find that deals continue to become more palatable in the coming weeks and months, though rates will still be much higher for those coming off long term deals from the period of very low interest rates. We are likely to see gradual, small changes as opposed to a significant fall, but lenders are updating their product ranges regularly and we are generally seeing further reductions each time they do. For those looking to purchase a new home this year, it will be vital to seek professional mortgage advice to ensure you are making the best possible decisions for your circumstances.”
