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Expert Predictions For The 2024 Housing Market

House and keyring 1124978648 Yeti studio 725 x 500

Conveyancing expert predicts that changes to legislation and increased mortgage rates will force landlords without financial fallback to sell up in 2024. But, there’s better news for the residential property market.

Daniel Chard, Partner at UK conveyancing solicitors, Bird & Co, has made his 2024 housing market predictions for the year ahead.

The picture looks brighter for the residential property market than it has been in 2023, with trends predicted by the conveyancing firm including:

  • Mortgage rates going down
  • Housing demand increasing
  • House prices falling and then stabilising
  • Housing transactions picking up
  • Sustainable new build developments springing up
  • AI being used the speed up conveyancing and real estate processes

The huge increase in mortgage rates this year has since seen a steady reduction, which has plateaued in October/November 2023, but we feel it may gradually reduce in 2024.

As these mortgage rates continue to decline, and the cost-of-living crisis abates, we can anticipate housing demand to increase in 2024, especially for first time buyers. This competition will encourage house prices to fall at the start of next year. Then, as mortgage rates reduce further, and housing demand rises, the market should begin to pick up, and thus we foresee house prices stabilising at these lower rates.

To combat the ongoing demand for housing, as well as Net Zero targets, we predict more new build developments, with a sustainable touch, will be at the forefront of property development in 2024.

For conveyancers and real estate businesses looking to remain competitive and keep up with this demand, making use of AI will likely become the norm to expedite processes.

That said, the picture doesn’t look so bright for landlords, especially those in London. Daniel is concerned that increased mortgage rates, changes to legislation, and the cost-of-living crisis will make the landscape too turbulent for the landlords to sustain.

He says, “Many landlords looking to make ends meet may be feeling less obliged to hike their rates, wanting to strike a balance between keeping their property filled, whilst keeping up with their own racking expenses.

“Changes in legislation, including how landlords are taxed, changes to tenants’ rights, and EPC certificates, mean landlords are having to invest more into their property to keep up. This, on top of increased tax rates, means the average landlord may be forced into a difficult position.

“Other than selling up, this really leaves them with three options. Number one is they hike their rent prices to maintain their outgoings, potentially sending their current tenants packing and risking an empty property to await a willing tenant. Secondly, they keep their rent prices low to keep the property filled, and either break even or make a loss. Finally, they consider renting their property out on Airbnb as a more lucrative option.

“These concerns may be most stark in London. Over the past few years, people have been moving away from the big city, choosing other cities in the Southwest, Wales, and the Northeast. The current rental market in London, coupled with hybrid working, is set to send young people packing – bad news for London landlords.

“We predict that these problems will lessen come the end of 2024. However, this is only good news for landlords and landlord businesses who have financial backing to see it through to the other side. These lucky few may find their investment pays off in the long-term, but it is the small-scale landlords who will be disadvantaged the most.”

If you are looking to buy a property in 2024 and require a solicitor to get you started, Bird & Co can help. If you are planning to purchase, sell or remortgage your home in 2024, then get in touch with Bird & Co’s conveyancing solicitors by emailing enquiries@birdandco.co.uk, or calling 01476 591711.

Source : Bird & Co

Image : Shutterstock.com / 1124978648 / Yeti studio 

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18 December 2023

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