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London Property Market Outlook 2024: Strong Performance for First-Time Buyers and Rental Market
一月 15, 2024
London Property Market Outlook 2024: Strong Performance for First-Time Buyers and Rental Market 倫敦
By   Internet
  • 城市報
  • London rentals
  • London property market
  • first time buyers
  • rental market
Abstract: As per reports from the UK's Standard, 2024 is speculated to be the prime time for financially capable first-time buyers to enter the property market.

Predictions indicate that property prices in prime central London locations will remain stable, with a projected growth of 18.7% over the next five years. While higher mortgage costs may impact property prices in peripheral areas of London and other prime locations in the UK, it is expected that prices will start rebounding and growing in the latter half of 2024 as the market cycle concludes.


Buyers in prime central London locations typically do not heavily rely on mortgage loans, minimizing the impact of higher interest rates. According to data from Savills, only 23% of buyers in central London used mortgages to purchase homes in the first eight months of 2023. Consequently, it is anticipated that property prices in prime central London locations will remain stable in 2024, with a projected growth of 18.7% over the next five years.


For prime locations in the outskirts of London, higher mortgage costs have a more significant impact on property prices. It is expected that prices will continue to decline in 2024, with an overall decrease of approximately 2.0%.

London Property Market Outlook 2024: Strong Performance for First-Time Buyers and Rental Market

However, in the medium term, interest rates are expected to remain relatively high for an extended period, resulting in a slow recovery of the property market. Once there is an improvement in the UK and global economy, buyer affordability pressure will decrease, leading to a market revival. Current projections estimate that property price growth will peak at 6.0% in 2027. Therefore, for consumers with a demand for purchasing property, 2024 might be the optimal time to acquire property in prime locations outside central London.


Prime locations in other regions of the UK have shown robust performance during the pandemic, but buyers are adjusting budgets due to rising interest rates. Property prices are expected to continue declining in 2024. However, with a significant drop in interest rates expected in the second half of next year, the property market is poised for a rapid recovery.


By the end of 2028, property prices in prime locations in other regions of the UK are projected to increase by 18.6%, with growth rates of 16.2% in suburban London and 21.5% in the central and northern regions of England.


In addition to the purchasing market, the rental market is also exhibiting a strong growth trend. Data released by the UK property firm Hampton predicts a 9% increase in rents in London this year, followed by 8% next year, and respective increases of 4% in 2025 and 2026. This suggests that returns on investment for renting out London properties may also increase.


However, data from the Home Builders Federation and Glenigan shows that the number of approved new residential planning projects reached a historic low in the third quarter of 2023. Only 2,447 projects were granted planning permission in England, representing a 19% decline compared to the same period last year.


This implies that when demand inevitably rises again, insufficient supply will lead to soaring property prices, further widening the gap between those with housing and those without. Therefore, for individuals with plans to purchase a home, early planning is necessary to seize the opportunities in 2024 and avoid missing out on favorable conditions.

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London Property Market Outlook 2024: Strong Performance for First-Time Buyers and Rental Market
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