In a landscape of somewhat economic instability, the outlook for the 2024 property market is looking more positive. Deborah Richards, Managing Partner of Maddisons Residential, reviews recent buyer and homeowner trends in the context of wider economic shifts to give her perspective on what we can expect in the next 12 months.

The property market in 2023 remained resilient

Despite media predictions of high mortgage repossessions and crashing prices, the property market proved incredibly resilient over 2023. On a 12-month basis, prices were down just 1.1% nationally according to Zoopla House Price Index, and reached 2.4% here in the southeast, where escalating prices had been the norm over the pandemic. This is mainly because, despite low interest rates prevailing from 2008 until the end of 2021, the banks have been stress-testing affordability since 2014, ensuring that even if rates reached 8%, homeowners could afford their commitment. 

Generation Z sought homeownership due to high private rent rates

First time buyers have been the most dominant buyer group, seeking to leave the private rental sector as average rents continue to rise faster than average mortgage repayments. Most baby boomers and millennials consider property as part-home and part-investment vehicle – the gift that kept on giving.

But the property market looks very different when viewed through the eyes of twenty-year-olds. For them, the last decade has been challenging, often priced out of home ownership and suffering increasingly high rents. They are not looking for investment opportunities, but simply somewhere to lay their heads. ‘Out of the mouths of babes’ – Generation Z reminds us that first and foremost a home is to live in.

Older family members are increasingly investing in property for their children

We should not forget the role the older generation is playing in this residential resurgence. Baby Boomers might not be moving much themselves currently, but, in 2023 the Bank of Mum and Dad and the wider Bank of Family invested over £8 billion in property; that’s not personal investment, but an investment in the futures of their children and grandchildren.

Typical annual property sale transactions for 2024

The outlook is overall more positive: inflation and mortgage rates are reducing, and the sentiments above mean that – even with an approaching General Election, in which the property market will hold its breath once again – I predict prices will at worst reduce by 1% to 2%, and property sale transactions will reach a very normal and typical one million across the year.

While the housing market is slowing, we are pleased to see that the outlook for 2024 is remaining positive. If you want advice and help on buying or selling a property in or around Tunbridge Wells, please contact us as our experienced team would love to help.