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The UK housing market, particularly in London, has been undergoing significant changes in early 2024. Fluctuating mortgage rates, the broader economic climate, and government interventions have played major roles in shaping market dynamics. This piece explores the current trends and provides insights into the market’s future direction.

Market Trends and Analysis

In 2024, the UK housing market has experienced modest price growth, with national house price indices reflecting slight increases. The Nationwide House Price Index reported a 0.6% annual increase in prices as of April 2024, while the Halifax House Price Index observed a 1.1% annual change during the same period. These figures suggest a stabilisation in the market following previous volatility, indicating controlled growth that prevents rapid inflation and creates a more predictable environment for both buyers and sellers.

Within London, the housing market presents a mixed picture, with variations across different boroughs. For example, Southwark experienced a decrease of 2.5% in house prices over the past year, whereas Rightmove data indicates a modest increase in average asking prices in London, suggesting a recovery or stabilisation in certain segments. This diversity in price trends reflects broader regional adjustments within London. Areas like Kensington and Chelsea have seen slight increases in property values, illustrating how localised factors such as new developments, transport links, and amenities impact housing prices.

The rental market in London has also undergone significant changes. Growth in average rental prices has slowed, reflecting a potential easing in rental price pressures. However, affordability remains a critical issue as rental prices continue to outpace wage growth, straining affordability for many residents. Despite the slowdown in rental price growth, the high cost of living and rental affordability remain significant challenges for Londoners. Popular areas like Hackney and Islington, known for attracting younger professionals, continue to face high rental prices, exacerbating the affordability crisis.

Economic Impacts on Housing

Economic factors such as inflation and mortgage rates are crucial for understanding housing market dynamics. Inflation has fallen below 4%, leading to speculation about potential interest rate cuts, which could influence housing market trends in 2024. The Bank of England’s recent adjustments have led to significant increases in mortgage approval rates, reflecting the market’s responsiveness to economic policies and buyer confidence. These economic shifts are expected to impact both buyer behaviour and overall market stability. Lower mortgage rates could make purchasing more attractive, potentially boosting demand and driving price growth.

Looking Ahead

The UK housing market, particularly in London, is likely to continue evolving in response to economic changes, policy updates, and market dynamics. Key factors to watch include government housing policies aimed at increasing housing supply and affordability, such as new building regulations and subsidies for first-time buyers. The broader post-pandemic economic recovery and its effect on consumer confidence and spending power will also be crucial. Additionally, shifts in consumer confidence influenced by economic stability and employment rates will affect people’s willingness to invest in property.

In Summary

While challenges such as affordability and supply issues persist, signs of recovery and stabilisation are evident. The housing market indicates potential for more stable conditions in the future as economic and policy adjustments take effect. Continued monitoring of these factors will be crucial for understanding and anticipating future market trends.

To discuss REIM Capital’s short-term bridging options across England and Wales, contact us by emailing or calling 0203 488 4913.


– Nationwide House Price Index

– Halifax House Price Index

– Evening Standard

– Norada Real Estate Investments

– Knight Frank

– House of Commons Library

By Benjamin Cottey-Hill, Portfolio and Funding Analyst