Why Current Market Conditions Favour Buyers and Sellers

Why Current Market Conditions Favour Buyers and Sellers

The UK property market has seen some notable changes recently, with the average price of a house rising to £266,334 last month. While this increase marks a recovery from weaker growth at the same time last year, it’s important to note that prices remain below the all-time highs recorded in the summer of 2022.

Factors Influencing the Market

Several factors have contributed to the recent jump in house prices. One key reason, as noted by Mr. Gardner, is the weak growth observed last year. However, a more significant factor is the growing confidence among potential buyers as their wages rise in real terms. Despite a slowdown in pay growth, wages are still outpacing rising prices, contributing to a more positive outlook for many prospective homeowners.

The Bank of England's recent decision to cut interest rates to 5%, down from 5.25%, is another crucial development. This rate cut, which came after interest rates had been at their highest level in 16 years, is aimed at easing borrowing costs. Higher mortgage rates had previously made it challenging for many people to afford to buy a home, particularly those with tracker mortgages or those looking to secure or renew mortgage deals.

Supply and Demand Dynamics

One of the main reasons house prices are so high in the UK relative to wages is the imbalance between supply and demand. The supply of housing has not kept pace with the increasing demand for quite some time. This imbalance has not only driven up house prices but also pushed rental prices higher.

In response, the new government has pledged to deliver 1.5 million new homes in England over the next five years. This ambitious plan includes overhauling the planning system and allowing developers to build on some greenbelt land. These measures aim to increase the housing supply, which could help stabilise prices in the long term.

Opportunities for Buyers and Sellers

The current state of the property market presents both opportunities and challenges for buyers and sellers. On the one hand, fluctuating interest rates have led to signs of easing in the average mortgage rate, making financing for homes a bit easier. For buyers, less competition means more power to negotiate deals, potentially securing better prices for their desired properties.

On the other hand, sellers are benefiting from increased market confidence, with more properties being sold at competitive prices. With the right staging and pricing strategies, sellers can maximise the value of their properties. At David Astburys, we are committed to helping you achieve the best results for your property. Our expert team can guide you through the process, ensuring that your home is presented in the best possible light and priced correctly to attract serious buyers.

 

 

 

 

 

View this post on Instagram

 

 

 

 

 

 

 

 

 

 

 

A post shared by David Astburys Estate Agents (@davidastburys)