Summer Market Report 2024 🌸🪻
Recent weeks of partly clear skies and sunshine have brightened many moods. Although conditions remain tough, the improved economic outlook is encouraging for the housing market 🌸🪻
Market Dynamics
The UK economy grew by 0.6% between January and March 2024, marking the end of the recession (ONS). With inflation falling to just 2.3% in the 12 months to April 2024, close to its 2% target (ONS), the Bank of England is widely anticipated to cut the base rate imminently.
Economists at Capital Economics are forecasting the base rate to be at 4.5% by the end of 2024, with the first cut expected in August. With the economic outlook brightening, consumer confidence in May rose to its highest level since December 2021 (GfK Consumer Confidence Tracker).
Despite borrowing costs being more expensive than the ultra-low period a few years ago, the recent stability has meant that homeowners can be confident in their ability to afford a mortgage and can benefit when rates do fall. With a widely expected base rate cut alongside the usual spring optimism, almost two-thirds of agents say that buyer confidence has improved compared to three months ago.
Mortgage approvals reached 61,140 in April, a significant annual increase of 26% and only the second month since August 2022 that approvals have topped 61,000 (Bank of England).
