Buyers are securing an average £10,000 (3.9%) discount to the asking price to make a deal in the first three months of the year, which is far less than the £14,250 average discount (4.5%) seen in November 2023
Sellers are taking a smaller discount to secure a sale as more properties hit the market and mortgage rates hikes hit pause, according to Zoopla.
Buyers are securing an average £10,000 (3.9%) discount to the asking price to make a deal in the first three months of the year, which is far less than the £14,250 average discount (4.5%) seen in November 2023. This is lowest since July 2003, according to the figures from Zoopla’s monthly House Price Index.
Discounts remain larger in London and the South East, where there is an average discount to asking price of 4.3% or £19,500.
We do not believe that house prices are about to rise more quickly but there is more buyer interest. Sellers need to remain realistic on where they set the asking price if they are to take advantage of improving market conditions to secure a sale and move home in 2024, Richard Donnell, executive director at Zoopla, said.
New sales agreed are 9% higher than a year back, a trend that is encouraging more sellers to list their homes for sale with 20% more homes for sale compared to this time last year.
The property market has received a boost, with mortgage rates now at 4.4% for a 75% LTV 5-year fix rate loan, down by more than 1% from a high of 5.8% in June 2023. After years of ultra-low rates, 4% can still be considered high but far from the average two-year deal of 6.66% logged during Liz Truss’ mini-budget.
Increasing wages and dropping mortgage rates have boosted consumer confidence and this is feeding into improving levels of housing market activity over Q1 2024. House prices are dropping at a slower rate but it remains a buyers market where there is much greater choice of homes for sale, Donnell added.
The strongest growth in sales activity continues to be in areas with more affordable house prices like Yorkshire and The Humber (11%) where the average house price is £185,600 and the North West (13%) with an average house price of £194,500. The strongest growth in new sellers listing homes is in the South West (28%) and North East (26%).
