2024 looks set to be another great year for the UK property market

2023 was another strong year for the UK property market, with rents continuing to grow despite a slow in house prices. With the Bank of England freezing interest rates in the final quarter of 2023, inflation has dropped further creating a more enticing market for those looking to invest in 2024.

Property purchasers have a lot to look forward to, with the basic UK interest rate expected to go back to 4% over the next 12 months. This will in turn create a better opportunity for those looking for better borrowing rates, as more landlords look to unlock equity.

Fresh data from the Office for Budget Responsibility(OBR) indicates that the UK property market continues to show its resilience.Despite a fall in 2023, the OBR projects that by the end of January, the average house price will have increased by 0.9% over the previous 12 month period.

It serves as an example of how, despite several negative headlines claiming that property values are decreasing, in many situations what is actually happening is that the rate of growth has slowed down rather than ground to a halt.

The most recent UKHouse Price Index from Zoopla, which indicates a 15% increase in the number of homes sold annually, supports this. The market is strong and busy; in fact, it is doing much better than it usually does during the winter slowdown.

According to a Savills, the average rent in the UK has increased by 9.5% annually and by more than a quarter since March 2020. It is anticipated that this growth will continue in the future due to the mismatch between supply and demand.

Emily Williams, a director in the Savills residential research team, said: “Competition for stock is tough, and tenants are having to bid upwards to secure a tenancy, supported – but only in part –by a strong growth in incomes, fuelling rents upwards in the short to medium term.”

She added: “It’s very difficult to see where an increase in rental supply will come from in the next couple of years.”

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