The UK property market has shown promising signs of a recovering market, driven by steadying mortgage rates and a 65% increase in the number of homes for sale compared to last year. According to industry reports, buyers have returned to the market, with 11% more agreed sales than in 2019, indicating increasing confidence in the market.

However, while the market has shown improvements, it's important to note that it is still fragile, and uncertainties remain. While the number of agreed sales is up 11% from 2019, it's still lower than the pandemic housing boom observed in 2020 and mid-2022. Additionally, according to Zoopla's latest data, the market continues to face a supply shortage, with the total number of homes for sale in the UK still 26% below the 2018 average.

One segment of the market that is in a favourable position is second steppers looking to upsize. They benefit from more choices, time, and bargaining power with their next purchase, along with higher demand at the lower end of the market. However, it's important to note that the majority of buyers in the market are first-time buyers, who accounted for one in three sales last year. Therefore, it's crucial to understand the factors influencing first-time buyers' decisions when assessing the market's overall health.

One of the primary factors affecting first-time buyers' decisions is affordability. Despite the rapid 11% rise in rental rates in the last year, many renters are still struggling to save enough for a deposit. Furthermore, while mortgage rates remain below rental costs in many regions, the current 4% mortgage rates limit buyer power by up to 20% compared to last year, reducing the number of buyers who can afford to enter the market.

Another key trend in the property market is the repricing of house prices, which is expected to support activity across the housing market in 2023. The highest prices seen in mid-2022 are not sustainable with the current mortgage rates available, so the natural correction towards more realistic prices will encourage more buyers into the market. However, localised areas are expected to see a 5% house price fall, while sellers' concerns will be alleviated by an average gain of £19,000 to their home's value in 2022.

In conclusion, the UK property market has shown positive signs of a recovering market, driven by steadying mortgage rates and increased supply. However, the market's recovery is still fragile, and uncertainties remain, such as the supply shortage and affordability challenges for first-time buyers in many parts of the country.

At Seths, our dedicated sales team are here to guide you through the ever-changing property landscape we are currently seeing.

Whether you are looking to buy or sell your property, speak with us by calling 0116 266 9977, and let our team guide you through every stage of the process.