Each year, a number of trends in buying and selling property start to take shape - and while it's not an exact science, we've picked out eight conveyancing trends to watch in 2024, based on housing market activity from the past few years.
Our 2024 house buying trends cover every age group and status, from cash buys to forced sales. So, what might the new year have in store for the UK property market?
1. Cash vs Mortgage Purchases
Buying for cash can speed up conveyancing, as there's no need to wait for a mortgage lender's approval prior to completion. Because of this, a cash purchase is a good way to negotiate a lower price.
This was seen throughout 2023. By October, Land Registry figures showed that the average cash purchase price in England stood at just over £285,000, while the average mortgage purchase was valued at over £315,000.
Over the previous 12 months, the average cash price fell 1.6%, compared with 1.4% for mortgage purchases - a slight widening of the gap which, if it continues, could see a cash buy make even better financial sense in 2024.
2. New-Build vs Pre-Owned Properties
Buying a new-build property also carries a premium, with an average purchase price of nearly £460,000 in August 2023, against a price of just over £300,000 for a typical existing property.
That's a hefty 53% difference, and the gap widened significantly in 2023. In the 12 months to August, pre-owned properties actually fell in value by 0.6%, whereas new-builds rocketed up by 21.1%.
With new-builds accounting for just 3 in every 1,000 property sales in England in August 2023, according to Land Registry data, savvy buyers are likely to look to period properties even more in the coming year.
3. Under-40 First-Time Buyers
Under-40s are increasingly priced off of the housing ladder, but first-time buyers are getting creative as they look for ways to afford their first home.
In August 2023, Zoopla reported that under-40s are more likely to be living with their parents than expecting to buy a home of their own - and nearly 40% of those earning over £60,000 don't expect to buy a house within the next decade, let alone the next year.
So how are under-40s making it onto the housing ladder? Zoopla reported that 31% would consider part-ownership, 18% would buy with friends, 20% would buy a fixer-upper and 19% would consider self-building from scratch.
The younger end of the market is hugely dynamic and contains a number of conveyancing trends all of its own - watch this space for some of the most exciting developments in 2024.
4. Parental Help to Buy
Needless to say, parents are helping their grown-up children to put down a deposit and, in some cases, going much further than that.
At the end of 2021, Zoopla found that nearly two thirds of parents had chipped into their children's deposits, lending or giving them an average of over £30,000.
The research revealed some striking statistics: 14% of parents gave over £50,000 to their children, 11% covered the full deposit, and 4% said they had paid the entire purchase price so their child could live mortgage-free.
We've had sky-high inflation and a cost-of-living crisis since then, but if the economy improves in the coming 12 months, we may see many more parental property purchases to help adult children into homeownership.
5. Multi-Generation Households
But what about families living under the same roof? In December 2023, Zoopla found some of the most commonly used search terms of the year related to properties with room for multiple generations.
'Annexe' ranked in the top three most searched terms - and Zoopla noted that a third of all UK households meet the definition of 'multi-generational'.
With higher interest rates impacting mortgage availability, searches relating to first-time buyer words and phrases fell by 52% year-on-year, and Zoopla estimated a fall of more than 15% in FTB purchases based on this.
Again, it depends on the strength of the economy - and any movement in interest rates - in 2024. But with some economists expecting rates to fall, this could be the year when some multi-generation households make the move into separate homes.
6. Older Owners Downsizing
As for those whose children have already moved out, in December Zoopla found that the UK's over-65 homeowners have a combined total of ten million spare bedrooms sitting unused.
One in four of those surveyed were reluctant to downsize due to concerns about having enough space to host Christmas.
But with three-bedroom properties facing the highest demand nationwide, Zoopla urged older owners to consider a move.
Zoopla's consumer expert Daniel Copley said: "For those that are considering downsizing, it could increase supply of suitable properties for younger buyers so they can find their perfect home."
The average over-65 homeowner hasn't moved house in 26 years, leading to some potentially huge capital gains to be made - will 2024 be the year for a surge in pensioner property purchases?
7. Reduced Price for a Quick Sale
A quick sale is nearly always preferable - that's partly why cash buyers often get a better deal - but across the board, reducing the asking price or accepting a lower offer is one way sellers are speeding up the process.
In June 2023, Zoopla reported that 42% of sellers were accepting offers more than 5% under their asking price, the highest proportion since 2018.
A hefty 15% of sellers were open to offers of 10% below the asking price in summer 2023, helping to make properties more affordable against the market's higher mortgage rates.
This is another trend that depends in part on how the Bank of England base rate changes in 2024, but if rates stay higher than in previous years, deep discounting could be a fixture for the foreseeable future.
8. Forced Sales
Finally, with all these affordability concerns, are more people selling up to avoid repossession? Surprisingly, the answer seems to be no.
In December 2023, Halifax's Housing Market Review and Outlook for 2024 noted that the number of completions in the UK property market had fallen due to pressures on household finances.
Yet Kim Kinnaird, director of Halifax Mortgages, said: "There doesn't appear to have been a spike in the number of forced sales," citing only a "marginal increase" in unemployment levels and the protection of fixed-rate deals.
This is good news for homeowners, but kept stock levels low in the 2023 housing market. As more fixed-rate deals come to an end over the course of 2024, this could be the year when forced sales volumes start to creep higher.
The UK housing market - like the wider UK economy - has been turbulent since the end of the COVID-19 lockdowns, but we are finally seeing more signs of stability as interest rates plateau and the post-pandemic moving frenzy comes to an end.
While this leaves a lot of uncertainty in the outlook for 2024, there are some clear conveyancing trends emerging as patterns from previous years either continue or reverse.
If this leads to more supply coming on to the market, we could see transaction volumes increase and asking prices fall - all good news for would-be buyers who have been priced out due to poor availability of mortgages and properties since the start of the decade.
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