UK property continues to show solid results - 09/02/2024

Despite earlier forecasts of a decline, the UK housing market is poised for a recovery in 2024, buoyed by a competitive mortgage market and anticipated Bank of England interest rate cuts.

Despite earlier forecasts of a decline, the UK housing market is poised for a recovery in 2024, buoyed by a competitive mortgage market and anticipated Bank of England interest rate cuts.

Following a year of consistent price drops in 2023, Knight Frank has revised its forecast, now projecting a 3% increase in UK house prices for 2024, up from its previous estimate of a 4% decline.

Initial predictions from banks, building societies, and estate firms all foresaw falling house values by 2024, but recent trends have shifted perceptions. The UK's official inflation rate has decreased more than anticipated, and unexpected monthly gains have prompted a re-evaluation.

However, despite the potential benefits of lower-interest loans, millions of homeowners are bracing for a significant uptick in their monthly mortgage payments as their current deals expire. Political commentators speculate that this scenario could aid Rishi Sunak in an election year.

Furthermore, a trend toward lease extensions, as individuals wait for anticipated lower interest rates in 2025, is expected to impact the rental market significantly. While the real estate sector still grapples with undersupply challenges, ongoing efforts by developers to meet demand suggest continued positive expansion in the UK market.

For more insights into the UK property market, connect with a member of the Compare Yields team today.

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