House Prices in the UK Are Recovering as We Enter 2024
Whilst the fundamentals of the housing market in the UK have remained strong, house prices across the domestic and residential markets have stalled somewhat in recent times thanks to economic headwinds outside of the market.
For those investors that have been keeping tabs, the inflation crisis certainly appears to be easing from the peak around 6 months ago and the economy, whilst not booming, is slowly on its way to something resembling a recovery.
The property market is strong fundamentally thanks to a number of factors, but the area where one might consider it to be slower now appears to be recovering once again.
House prices in the UK are rising again
It spells good news for UK property investors. In October, house prices experienced a welcome 1.1% increase, breaking a six-month trend of decline, as reported by Halifax, the country’s largest mortgage lender. This boost brings the average property value to an impressive £281,974.
The rise is attributed to a shortage of homes for sale whilst buyer demand remained steady according to Halifax. Although the overall demand remains roughly the same, first-time buyers are holding up relatively well in the market, finding the prospect of owning a home more attractive, especially in the face of rising rental prices.
While Halifax predicts a steadying of prices until 2025 due to factors like higher interest rates and cost of living pressures, it emphasises that recent months’ decreases follow a prolonged period of gains. The current average house prices still stand approximately £40,000 above pre-pandemic levels, providing a positive perspective for property investors.
Even with a cautious approach from sellers leading to a low supply of homes, the market is showing signs of competitiveness among mortgage lenders. Halifax and Virgin have recently lowered their rates, indicating a favourable trend for 2024. Despite the short-term challenges, the resilience of the property market and the potential for future growth make it an encouraging time for UK property investors.
Investing in UK property
Investing in UK property, particularly in off-plan developments and holiday lets, presents compelling advantages for savvy investors. Off-plan investments offer an opportunity to secure properties before they are completed, often at a lower price, allowing investors to benefit from potential capital appreciation as the development progresses. Additionally, the flexibility to customise finishes in off-plan properties can enhance their appeal and value.
Holiday lets, on the other hand, tap into the thriving tourism industry in the UK. The demand for unique and comfortable accommodations for short-term stays has risen significantly, providing a lucrative avenue for investors.
Holiday lets often generate higher rental yields compared to traditional long-term rentals, making them an attractive option for those seeking substantial returns on their investment.
If you’re looking to make an investment in UK property or diversify your portfolio then why not get in touch with us today?
