Did you manage to make it through the month without reaching for the bottle to console yourself.
No, I’m not enquiring if you managed to navigate Dry January. I’m talking about how you embraced the first four weeks of 2024 working in the property sector.
I put down my glass of sherry and returned to work on January 2nd.
And I was greeted by a late Christmas present – a surge of enquiries stemming from the festive period.
Reports suggest this was replicated across the sector, with enquiries increasing by over 30% compared to the previous year for many.
Yes, the baseline from the prior year was established during a challenging market period, not least a flawed mini-budget.
But, nevertheless, there was an optimistic atmosphere. And this permeated through January.
In the initial three weeks, the heightened enquiries translated into a 13% surge in sales according to Zoopla.
This number suggests that numerous potential buyers either weren’t ready to commit or struggled to find their ideal property in those crucial initial weeks.
So January can be summarised thus: a month of a Post-Christmas flurry super-charged by pent up demand and better economic news.
What can we expect in February?
Global conflicts and uncertainties have notably affected the public mood. There is a danger that fuel and commodity prices could increase rapidly if the conflicts on trade routes escalate. Most notably, those eager to purchase in early January have likely already done so. So this month’s market relies on individuals who either couldn’t secure a property swiftly or newcomers entering.
This is likely to mean the initial flood will become a more steady stream. But this could actually be good for the market as it will help us to avoid riding peaks and troughs.
But it also means that a recovery in prices that many hope for, will take longer.
Nationwide’s most recent survey of house prices is a useful indicator of seller sentiment.
The lender’s reports of the 0.7% increase in January will need to filter its way into sale prices over the next few months.
Last week we heard The Bank of England held rates at the current level – this is good news. With increase after increase last year, a ‘hold’ feels like a win. It is highly likely we will see rates fall in the coming months. Although that is a good thing, the wide expectation of cheaper mortgages down the road will lead to some holding fire now, and this is not something that will aid recovery.
So February will be a month of consolidation – prices should stabilise, and we may even see a small rate reduction at the end of the month.
I suspect we will slowly return to more normal market conditions. What’s ‘normal’? A market where properties will sell, just not at the ever-inflating prices of previous years.
If some heat goes out of the market, that’s a good thing too.
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