2024 has been a turning point for the UK property market. House prices have started rising fast and we are at the beginning of a new property cycle that promises much more growth to come in the future.
As we approach the end of the year, the good news keeps coming.
New data from Nationwide – the UK’s biggest high street lender – shows that house prices are just 1% lower than the all-time record.
The annual growth rate also grew to 3.7% November, a huge improvement over the year-on-year rate of 2.4% seen in October.
Robert Gardner, the Nationwide chief economist, said: “The acceleration in house price growth is surprising, since affordability remains stretched by historic standards, with house prices still high relative to average incomes and interest rates well above pre-Covid levels.
“Housing market activity has remained relatively resilient in recent months, with the number of mortgage approvals approaching the levels seen pre-pandemic, despite the higher interest rate environment.”
Lack of housing supply ensures growth
The last time house prices were this high or rising so quickly was November 2022. That surge was driven by a post-Covid-lockdown spree of buying, driven by low interest rates.
In the years since, interest rates went a lot higher and buying became less affordable for many, slowing the rate of growth.
However, growth was always going to return thanks to the overall lack of available housing supply and the huge number of people who need a home.
Low construction levels mean that there aren’t enough homes to go around and it’s unlikely that there ever will be.
That makes the property market resilient, no matter how challenging the overall economy is.
We have now seen that during the tough times, the market was “surprisingly” strong. Now the economy is improving and interest rates are falling, house price growth has accelerated “surprisingly” fast in 2024.
Nothing surprising about house price growth
In reality, the lack of supply and overwhelming demand means that none of this should be a surprise.
Similarly, it means that we can look ahead with confidence at the next four years. Savills has predicted that the average UK house price will go up 23.4% by 2029.
In some areas it will be even more. For example, the North West is predicted to see more than 29% growth over the same time period.
Based on the evidence available and the historic supply shortage, perhaps growth in the future will be even higher than that. If it is, we should not be surprised!
2025 the perfect time to buy property and maximise returns
All of that makes 2025 the perfect time to buy property and maximise your returns. Those who buy early will benefit from the most growth – and earn the most money.
On the other hand, if you want another year you will pay a higher entry price as property values increase, and the available returns will be lower.
The best decisions will be made by savvy investors in the next six months. If you are looking to buy UK property, this is the time to act.
Discover our available high yielding UK property and get in touch with the team today to learn more about how to maximise your returns in this high time.