The housing market continues to adjust to 4%+ mortgage rates with positive signs of increased activity, according to the July 2024 Zoopla UK House Price Index, which adds that more sellers are continuing to list their homes for sale.

As a result, more sales are being agreed and buyers are paying a greater proportion of the asking price as confidence improves. The firm says that house prices were rising slowly across all regions and countries of the UK in the first half of this year, reversing the price falls recorded in 2023. Zoopla expects market activity to continue to improve but for prices to be kept in check by greater supply and affordability constraints.

House price inflation static, still negative in south
UK house prices edged 0.1% higher over the last 12 months, increasing by just £310 to £265,600. Annual price inflation ranges between -1.2% in the East of England to +3.9% in Northern Ireland.

The report states: ‘House prices have increased across all regions and countries of the UK over the first half of 2024. We expect house prices to continue to increase slowly over the second half of 2024. This means the annual rate of UK house price inflation will increase towards +2% by the end of the year as price decreases over H2 2023 fall out of the annual growth rate calculation.

‘Modest price rises help motivate sellers to list their home for sale but a return to faster house price inflation would be unwelcome. Affordability remains a major constraint on market activity, especially in southern England. The housing market requires a 12-24 month window where incomes rise faster than house prices to help reset affordability. Incomes are set to rise 4.5% in 2024 and we would also expect incomes to rise faster than house prices in 2025.’