The level of buyer demand in the UK property market has risen according to property website, Zoopla, as inflation across the country drops, the Bank of England chooses to pause the monthly increase in base rate, and mortgage interest rates begin to decrease.
Property website, Zoopla, has released new data which shows that as mortgage rates have started to decrease, inflation across the UK has dropped, and the Bank of England has paused its monthly base rate increases, buyer demand in the property market has begun to increase – with estate agents reporting an increase of 12% in enquiries for available properties in the market since the August Bank Holiday.
Following the decrease in buyer demand after the mini-Budget over 12 months ago, demand in the UK property market has been steadily increasing with the level now reaching its expected trajectory – when seasonally adjusted for the market following the tax cuts put in place during the Covid-19 pandemic.
Traditionally, September usually attracts more buyers to the market following the quieter summer period, but an increase in buyer enquiries by 12% has demonstrated an improved level of consumer confidence in the market which is now reportedly at a two-year high.
“Better than expected inflation news and a pause in base rate rises have softened expectations over the trajectory of future borrowing costs. … The closer mortgage rates get to 4%, the more buyers will come back into the market, supporting sales and pricing levels.” Richard Donnell, Executive Director of Research at Zoopla.‘‘
While demand across the country has increased, Zoopla has reported that the biggest house price falls are being seen in southern England as the capital and its surrounding areas as they continue to price out buyers in favour of commanding astronomical prices and rents, and the South of England has had the fewest buyer enquiries throughout 2023 to date.
Building Society, Nationwide has also reported a decrease in house prices in London of 3.8% year-on-year over the last quarter, following an additional decrease of 4.3% in the previous quarter.
At Beech Holdings, we regularly talk to clients who are looking to invest in the UK property market and have chosen to invest in Manchester and the North West as it provides higher yields for a much lower price than London, and this is no surprise when the average house prices in Manchester sit at £295,669, whereas the average house price in London is currently £764,877 according to Rightmove.