The UK housing market continues to show a positive trend, with major indicators showing significant growth. The data showed a 9% increase in transactions compared to the same period last year, and a 7% increase in home sales in the first quarter of 2024 compared to the same period last year. The momentum has also spurred more sellers to list their properties. The number of homes listed by agents has increased by an average of 11% in the past four weeks, while the overall number of homes for sale is up by a fifth on last year.

This positive market sentiment improvement is attributed to the rise in real wage growth and the healthy state of the job market, which have boosted buyer confidence. The latest surveys indicate that potential buyers' confidence in their personal financial situations has reached its highest level in over two years. Additionally, the 5-year fixed-rate mortgages at 75% loan-to-value have dropped from a peak in June 2023 to 4.4%, a decrease of over 1 percentage point, further stimulating housing demand.

Regionally, areas like Yorkshire, Humberside, and the Northwest have seen the strongest sales growth, while the most significant increase in newly listed properties for sale is observed in the Southwest and Northeast. The supply of homes for sale in London is only 8% higher than in other regions, explaining why prices in London rebound faster than in other areas.

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Although the annual price growth nationwide remains negative, it has significantly improved from last year's lows. Price declines are mainly concentrated in the southern regions, with the East and Southeast experiencing the most significant drops, while Scotland and Northern Ireland show an upward trend in prices.

With the recovery in sales volume and price stability, annual price growth in all regions is higher than six months ago. The market expects the current price trend to continue until the second half of 2024.

However, despite increased market activity, both buyers and sellers remain cautiously optimistic. Buyers are cautious about prices and continue to negotiate. In March property transactions, 41% of final sale prices were 5% or more lower than the asking price. Although this proportion has improved from last year, it still remains relatively high, indicating continued price sensitivity.

On average, sellers currently agree to a sale price £1,000 lower than the asking price, a decrease from £14,250 in November last year. This reflects more realistic pricing by sellers and increased buyer confidence.

The narrowing of price discounts further demonstrates market improvement. The average discount decreased from 4.5% in November last year to 3.9% in March 2024, reaching the lowest level since July 2023.

Looking ahead, it is expected that a further decrease in interest rates in the second half of the year will boost market sentiment, lower mortgage rates, and support the growth of property transactions. However, sustained income growth remains a key factor, especially in southern England.