As we enter 2024, the UK housing market is poised for a transformative year, influenced by the anticipation of rate cuts and the repercussions of the 2023 interest rate surge.
Our latest blog takes a closer look into the potential impact of these changes on home buying and home selling trends, property values, and the broader real estate landscape.
Before you start reading it’s worth noting that these are just our best guesses. We also may be completely wrong and if we had a crystal ball, we’d probably be playing the stock market…
Rate Cuts: A Silver Lining for Homebuyers
As of December 14th, the Bank Of England decided to pause any further rises. This comes off the back of the U.S. Fed announcing that rates were no longer necessary and many analysts believe that a potential 3 cuts are expected in 2024 to help stimulate the economy.
Therefore, 2024 is expected to herald a significant shift in the housing market, primarily due to anticipated rate cuts. After the tumultuous rise in interest rates in 2023 – leading to a wide market contraction in October by 0.3 – a reduction in rates could be a breath of fresh air for potential homebuyers.
Lower borrowing costs mean increased affordability, which could lead to a resurgence in the housing demand. This change is particularly beneficial for first-time buyers and those looking to upgrade their homes.
The rate cut could also stimulate the property market, leading to a moderate increase in house prices. However, this rise is expected to be more sustainable and steady, avoiding the pitfalls of an overheated market.
Navigating the Shadow of Foreclosures
The spike in interest rates in 2023 has had a less favorable impact, leading to an increased burden on homeowners struggling with mortgage repayments. This unfortunate situation could result in a higher number of foreclosures in 2024.
In May 2023, nearly 700,000 people had missed one mortgage payment. There are wider concerns that when mortgage deals end, this could see a sudden spike in figures.
The flipside is that millions of people could be paying hundreds per month more on their mortgage leading to larger foreclosures than foreseen.
For investors and buyers, this scenario might present opportunities to purchase properties at lower prices. However, it’s crucial for the market to balance these aspects to prevent a negative spiral in property values and maintain overall market health.
Home Trends and Value Addition in 2024
In terms of home trends, 2024 is expected to see a continued emphasis on sustainable and energy-efficient homes. With the growing awareness of environmental issues, properties that offer green solutions, such as solar panels or energy-efficient appliances, are likely to be more attractive to buyers.
The interior design trends are anticipated to lean towards minimalism and functionality. Smart homes, integrating technology for convenience and efficiency, will continue to be a significant trend. In terms of finishes, natural materials, and soft, neutral colors are expected to dominate, reflecting a desire for calm and serene living spaces.
Adding value to properties will focus on creating versatile spaces – home offices, outdoor living areas, and adaptable rooms will be key features that appeal to the modern buyer.
The Role of Estate Agents in Navigating the 2024 Market
For estate agents, 2024 will be a year of guiding clients through a market that’s recovering and reshaping. Agents will need to be adept at understanding the nuances of a post-rate cut market, the opportunities presented by foreclosures, and the evolving preferences of homebuyers.
Providing clients with insightful analysis, market forecasts, and tailored advice will be crucial. Estate agents will also need to stay abreast of the latest home trends and technological advancements to advise clients on how to add value to their properties.
The UK housing market in 2024 is set to be a landscape of change and opportunity. The expected rate cuts offer a promising outlook for homebuyers, while the rise in foreclosures presents both challenges and opportunities. Staying informed and adaptable will be key for both buyers and sellers in navigating this dynamic market. With the right approach, 2024 could be a year of fruitful investments and innovative home trends in the UK real estate sector.
Don’t forget, for all of your house buying and selling needs, we at Carman Friend have the team capable of delivering for you. With the best sales figures for CH1, CH2 & CH3* we have the knowledge to help you with your home buy or sell.
*figures presented to Carman Friend from RightMove.