"Windows of opportunity tend to need a momentum of good news to stay open, and there are still uncertainties ahead which could cause some of the current market activity to ease."
- Tim Bannister, director of property at Rightmove
The average price of property coming to the market for sale has risen by 0.8% this month to £370,759, double the long-term average for this time of year, according to the latest Rightmove figures.
Rightmove says this rise in prices beyond the usual seasonal norm has been driven by a strong recovery in activity this summer when compared with the much more subdued market at this time in 2023. It added that "that the traditionally busier autumn market has arrived earlier than usual, with many buyers and sellers spotting a window of opportunity to act".
Mortgage rates are trending downwards, there’s more property choice for buyers, and earnings are now rising faster than both inflation and house price growth, which are all contributing to better conditions for moving. However, despite some strong headline figures this month, Rightmove notes that "beneath the surface the market remains cautious, with pricing right still key for a successful sale". The timing of a second Bank Rate cut and which segments of the market could be affected by announcements in October’s Autumn Statement are creating uncertainties ahead.
The number of sales being agreed between buyers and sellers is up by 27% compared to this time in 2023, a strong rebound compared with last year’s more subdued market. In positive signs for future sales, the number of potential buyers contacting agents is also up by 15% compared with this time last year. Buyer choice has been improving, and the average number of available homes for sale per estate agency branch is at its highest since 2014, at 33 homes. This has come from a 14% increase in new properties coming to the market for sale compared with last year, but there still isn’t a glut of homes for sale, as this figure is only up by 3% when compared with the more normal pre-pandemic 2019 market.
Despite these strong figures, there are signs that the market is still cautious and price-sensitive. The average property is still taking 60 days to find a buyer, which is three days longer than at this time last year, even with better market conditions. This suggests that value-conscious buyers are taking their time to find the right home at the right price, leading to a two-speed market. Attractive homes priced accurately are likely to be met with interest from buyers quickly, while overpriced or poorly presented homes may languish on the sidelines. Additionally, though the downward direction of mortgage rates is welcome for mover sentiment, they remain high when compared with recent years. Rightmove’s weekly mortgage tracker shows that the average five-year fixed rate is now 4.67%. While this is lower than the peak of 6.11% in July 2023, it is still nearly double the 2.34% of this time three years ago, before the first of 14 consecutive Bank Rate rises. While some can afford to move and are seizing the current window of opportunity to act, others will still need to wait for mortgage rates to reduce and affordability to improve further.
Tim Bannister, director of property at Rightmove, commented: “The autumn action has started early with a strong rebound in activity from both buyers and sellers compared to the subdued market at this time last year, continuing the momentum from the better-than-expected summer market. The certainty of a new government followed by the first Bank Rate cut in four years invigorated the market, opening a window of opportunity for movers to act. Some of this will be pent-up demand from those who had to hit the pause button until now. However, windows of opportunity tend to need a momentum of good news to stay open, and there are still uncertainties ahead which could cause some of the current market activity to ease.
“Early autumn movers who are acting quickly and taking advantage of the improved market conditions are getting the pick of quality homes for sale. Home-owners who are thinking of coming to market soon shouldn’t let the increased activity make them over-optimistic and must price competitively to sell. With affordability still very stretched for many, choosy buyers are taking their time to browse the increased number of homes for sale and find the perfect home at the right price. There are question marks over how the market will be affected by announcements in the Autumn Statement, but until then we expect that market momentum will continue as the autumn action rolls on.”
