What happened to the UK premium property market following the election?

November proved to be no different with the following happening in comparison to last November and the November average over the past half a dozen years:

As you can see from the above figures, the election does not appear to have slowed down activity at the higher end of the market.

This can also be evidenced by an increase in sellers returning to the market in November who have tried to sell previously and there was also a significant rise in the number of sellers adjusting their asking prices, who were perhaps reacting to the stronger market conditions and wanting their property to appear better value for money as they faced increased competition from other sellers.

Mortgage approvals were up 42.59% compared to last year, 4.12% higher than the previous month, the highest they have been since August 2022 and have increased five months in a row.

Transactions were 21% up on last year, 10% higher than the previous month, 3.25% up on the 10-year average, the highest they have been since August 2022 and also the first time they have exceeded 100,000 in one month since then as well.

However, the glass half empty in me has slight concerns over the significant rise in the number of sales falling through and properties withdrawing from the market in November.

This could be perceived as evidence of both buyers and sellers not being that confident in the market following the budget and have decided to sit on their hands in the near future and see how things play out in 2025. 

Savills had just under 1,000 responses to their November client survey and it suggested that buyer sentiment had softened slightly compared to earlier this year, following on from the election and budget. 

As you will see from the image below though, 54% of those surveyed said the budget will have no impact on their desire to move or budget and 28% actually said they were more likely to move. 

Unsurprisingly, it was investors who were a lot less likely to enter the market following the budget with continued difficulties for landlords when it comes to increased tax, legislation, and interest rates compared to previous years.

This has also seen an increase in the number of properties for sale as some of these landlords look to exit the market as has been widely reported with approximately 10-20% of properties for sale having previously been rented out. 

Writing about how the premium property market has fared following the election made me think of a new word I came across recently which is ‘Permacrisis’ and it means a long period of great difficulty, confusion, or suffering that seems to have no end.

I think this perfectly sums up the political and economic climate for the best part of a decade now and yet the UK property market is still standing as the public seem to have got used to this now.

The strong performance of the property market following the election and budget are both great examples of this. 

The determination to get moved is evidenced by the fact we are on course for 1.1 million transactions in 2024, a 10% increase on 2023 and a prediction of 1.15 million transactions in 2025, which is just 50,000 shy of the 1.2 million 50-year average.

We have seen the base rate come down twice by 0.25%  in 2024 from 5.25% to 4.75%, with the second of these drops coming in November.

The MPC will meet once more this year on 19th December to discuss the base rate, but it is widely reported that they will vote to pause on this occasion, but headlines this week have suggested the possibility of four reductions in 2025 that would bring the base rate down to 3.75%.

This aligns with previous reports that predict quarterly drops to the base rate as the caution of the market reflects the uncertain inflation outlook.

Mortgage rates for buyers have fallen by 1% in the last year, but have increased slightly in the wake of the Autumn Budget and the predictions are that they will remain unchanged throughout 2025 as the markets have already factored in future drops to the base rate.

To finish off my last article of the year, I thought I would get into the Christmas spirit by discussing portal activity across the festive period. 

At this time of year, nothing divides a nation or a bunch of estate agents more than whether Die Hard is a Christmas film (it 100% is) or if launching a property on Boxing Day actually benefits a seller or not.

It’s a bit like being told not to discuss sex, religion, or politics at a dinner party, but with estate agents it’s don’t mention the Boxing Day myth.

I have reviewed the stats for the last five years on properties listed between Christmas Day and New Years Day and found that approx 42% of the alerts going out on Rightmove were for properties that had reduced their asking price.

Therefore, I am of the opinion that it is very much the Boxing Day sales event as opposed to a Boxing Day launch and if I was a seller wanting to list my property on the market, I would not want to be doing so when all the other sellers around me are reducing their asking prices, thus making my property look more expensive and worse value for money.

Rightmove reports an 82% increase in visits to their website on Boxing Day vs Christmas Day, but as you will see from the below image, traffic to Rightmove unsurprisingly drops in the few days prior to Christmas Day and then reverts back to the usual traffic seen earlier in December.

However, as you can see from the graph above, there is a 69% increase in visits to Rightmove in the second week of January versus the first week of December.

Zoopla also reported that January was the busiest month for traffic in 2024 followed by February and March.

Rightmove have previously said that the best months to sell a property are February and March, with February being the month in which properties sell the fastest and the highest percentage of properties reaching sale agreed, whilst March is also a strong month to sell a home, with the highest number of buyers enquiring about properties.

February listings are also the most likely to go and finalise a completion of sale, and the least likely to be withdrawn by the owner from the market.

The data highlights that those getting ready to sell at the start of spring are putting themselves in the best position to get moving in 2025.

However, if sellers want to market their property this side of 2025, there is nothing wrong with that at all, but I would be advising to soft launch any new listings to your own website and social media channels in the lead up to Christmas and to list on the property portals in the New Year.

The 2024 premium market has had a great recovery following a difficult 2023 and I think we are in for a strong 2025 as there is certainly a cautious optimism in the air and a just get on with it attitude amongst home movers regarding a potential move as interest rates have continued to steadily come down over the past year and there is a lot more choice of property available to buy than there has been in recent years as you with stock levels currently at a 10-year high.

As always, thank you for reading these blogs throughout 2024 and stay tuned for the next edition in January where I will be reporting on the 2024 premium property market and how it compares to previous years. 

Merry Christmas!

P.S. You can CLICK HERE to watch my November UK property market update on YouTube.