Buying, selling or moving home in 2024? Here's what you need to know
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Buying, Selling or Moving Home? Here's what you need to know for 2024
Predictions for 2024 housing prices range from stability to a potential 5% decline. Experts suggest that a drop in mortgage rates could reinvigorate the market.
In this challenging time, we explore advice tailored for both buyers and sellers. Mortgage rates have experienced volatility, swinging from sub-4% lows to over 6% highs throughout the year.
The average two-year fixed-rate mortgage peaked at 6.87% in the summer but has since eased to 5.95%. Homebuyers and existing homeowners, accustomed to rates between 1 and 2%, are facing a new reality.
To buy or not to buy? The decision hinges on the trajectory of mortgage rates.
Approximately 1.6 million households are poised to transition from affordable fixed-rate deals, potentially facing financial adjustments even if interest rates continue to decrease.
While house prices haven't experienced the crash some anticipated, the post-pandemic boom has evolved. This year witnessed a standoff between sellers and buyers, with unrealistic asking prices deterring potential buyers awaiting possible price drops.
The average time for a seller to secure a buyer has extended by three weeks, rising from 45 to 66 days compared to last year, according to Rightmove's latest data. Simultaneously, Zoopla reports a 23% reduction in house sales year-over-year.
Is 2024 an opportune time for first-time buyers?
Paradoxically, 2024 may present opportunities for first-time buyers. If homes continue to struggle to find buyers, some sellers might become more amenable to considering lower offers.
In fact, this trend is already emerging. Zoopla revealed that one in four sales are now agreed upon at 10% or more below the asking price.
Considering the limited options in an under-supplied rental market with escalating monthly rents, buying may remain the best choice for many aspiring first-time homeowners.
For those looking to move homes, the fluctuation in house prices might not be crucial, especially if selling and buying occur simultaneously. The falling house prices could work to the advantage of those upsizing to more expensive homes.
What's on the horizon for mortgage rates?
The decision to buy or move in 2024 heavily depends on the trajectory of mortgage rates. Securing a mortgage has been challenging over the past year, marked by initial declines, a stagnant period, and a summer surge pushing even the most affordable rates beyond 6%.
However, recent months have seen a decline in mortgage rates, with the cheapest options dropping below 4% for the first time since May.
With rates stabilising and forecasts suggesting a potential decrease in the Bank of England base rate next year, prospective homebuyers and movers who hesitated in 2023 might find 2024 more enticing.