Spring Update

In the first nine weeks of 2024 Chester saw 458 sales agreed, which compared to 375 in the same period in 2023 highlights the strong start we have had to this year. This is a 22.1% increase in Chester home sales year-to-date which is higher than the national average.  

We are also seeing a trend of North-West buyers expanding their search radius in pursuit of better value rather than downsizing due to increased borrowing costs. Research indicates that a third of households looking to move are considering areas outside their local vicinity to secure their desired property.  

Looking ahead, the housing market is forecasted to continue firming throughout 2024, but with no immediate acceleration in house price inflation anticipated. The trajectory of price stability and market activity will largely hinge on future interest rate movements, although current fixed-rate mortgages reflect expectations of stable rates for the remainder of the year.  

Ultimately, sustained price stability is deemed essential for fostering continued growth in sales across the Chester property market and nationwide. 

With the Bank of England sitting on its hands again, borrowers will have to wait that bit longer for the first base rate cut since 2020. Inflation falling slower than expected has put the brakes on, with policymakers waiting for signs that the cost-of-living crisis has been shaken off - and there may be some way to go yet. Swap rates have also been choppy on BofE expectations, and it’s why some lenders have repriced in recent weeks.  

Nevertheless, the picture for the current mortgage market looks a lot more positive than for much of last year.  March saw an 18-month high in mortgage approvals, with new buyers pressing ahead with their plans. 

Despite evidence of unrest in the market, mortgage rates have stabilised, and we expect to see more confidence from buyers as the year continues. A third consecutive month of growth in the number of new buyers is great to see, as are the lower rates being offered to those looking to remortgage or buy their first home.

What we are seeing is the market finding its feet in a new higher interest rate environment which, although higher, remains low by historical levels. We expect inflation to continue falling, but also feel there may be small bumps along the way. The trend, however, should be gently downwards.  

While we thankfully aren’t in the same position as we were at the start of 2023, rates are higher than the levels homeowners fixed at two or three years ago, and repayments will still jump compared to what they have been paying. Current mortgage rates could be as good as they get, and therefore today’s new normal. There is little point in waiting for actual mortgage rates to fall much further, and therefore should feel decisive and act now if they are ready and wanting to do so.  

It’s all about seeing what’s out there. For those looking to get ahead, use the time before your product end date to get ‘mortgage ready’. Have a conversation with a broker - they will not only help you to find the most suitable deal but will also find out how much you can borrow towards your ideal next home, supporting you throughout the whole process.