The UK currently has £230bn ($293bn) worth of houses in the market, the highest supply of homes for eight years, which will keep house prices in check for the rest of 2024.
The supply of homes for sale is 20% higher than this time last year, up £45bn on this time last year, with the average estate agent handling 31 homes for sale – the highest level of supply in eight years, according to Zoopla.
“The growth in the supply of homes for sale is evidence of renewed confidence amongst homeowners, some of whom delayed moving decisions in 2023. The quarterly rate of house price inflation has picked up in recent months as more sales are agreed and prices firm,” Richard Donnell, executive director at Zoopla, said.
Sales agreed are up 13% year on year and while most homes for sale are new to the market, around a third (31%) of homes for sale were marketed in 2023.
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The growth in supply has been driven by a rebound in the number of three and four+ bed homes for sale as existing owners return to the market and feel more confident to move after rising mortgages hit demand.
The snap general election in early July is not expected to hit the property market, with currently 392,000 homes in the sales pipeline working their way through to completion over 2024.
An increase in fall-throughs is unlikely due to the election announcement as there is not a huge divide in policy between the two main parties,” according to Zoopla.
“The announcement of the election will slow the pace at which new sales are agreed while greater choice for buyers will keep house prices in check over 2024. It’s essential that those serious about moving in 2024 price their homes realistically if they want to achieve a sale,” Donnell said.
Guy Gittins, chief executive of Foxtons (FXG.MU), also does not believe that the general election will hurt house sales.
“Despite last week’s announcement of a general election, we’ve not seen a dampening of sentiment from buyers and sellers; in fact, last week we saw more sales agreed than we have done at any point during the same period in the past six years,” he said.
“The prospect of a change in government hasn’t deterred new buyers from entering the market either, last week we also had a record number of new applicant enquiries compared with the past five years. As buyers and sellers await the next interest rate decision, they should take some confidence from the fact that homeowners and prospective buyers are acting with confidence, despite the uncertainty of the election ahead.”
Still, the pace at which sales are being agreed is likely to slow in the coming weeks which means the total number of sales for 2024 could drop below 1.1 million.
Read more: UK house movers undeterred by election, data reveals
When it comes to house prices, across the south of England, coastal cities and those where prices jumped higher over the pandemic during the ‘race for space’ are seeing prices drop as demand is now weaker.
House prices are rising in cities with below-average house prices where the impact of higher mortgage rates is less pronounced.
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