January jump in asking prices
The average new seller asking price rose by 1.3%, the biggest price rise for January since 2020. This is over double the 20-year average of +0.6%.
As mortgage rates fall and the economic outlook brightens, buyer demand is improving, with 42% of agents reporting that buyer demand is higher than a year ago.
The number of properties coming onto the market in the first week of the year was 15% higher than a year ago, indicating sellers’ increasing confidence for the year ahead.
Accurate and realistic pricing for the local area remains essential for those looking to get moving this year. Source: #Dataloft Poll of Subscribers, Rightmove (January 2024) (https://www.rightmove.co.uk/)
Why is there a January jump?
January jump in asking prices
The annual January jump in asking prices is a bit of an enigma. There is no doubt that more properties come to market over the Christmas period. This is the main down to Estate Agents plugging the ‘Urban Myth’ that Boxing Day is the day to launch a property on Rightmove etc. This is not true as Rightmove’s own figures show that the first week of January is a far better time to put a property on the market.
This year there has been a good increase of buyers (42% of all agents have reported an increase in buyers).
This is down to a few things:
Firstly, mortgage rates have continued to drop.
Secondly, inflation dropped to 3.9% in December and although it has risen to 4.0% today (17.01.24), it’s such a small increase that it will not affect mortgages.
Finally, a rise in buyers mean a rise in offers and good negotiating will push the price up.
What will happen in February?
If we knew for sure, we would be rich and retire gracefully!
What’s going to happen will very much depend on how much the property that is new to market has been overpriced. Hopefully very little. However, we are going to predict a ‘flattening’ of prices until early spring.
Why then?
Because signs are that the Bank of England will keep the base interest rate of 5.25% the same until early spring. Then it is predicted that it could drop to 5.00%. This will have a ‘knock on’ effect with bank swop rates. This in turn will mean further mortgage rate drops.