Darren Murphy’s Market Update
The UK residential sales and letting market in April has been shaped by a combination of economic factors, seasonal trends, and evolving buyer and renter preferences.
Sales Market Trends
After the rush amongst first time buyers to complete transactions ahead of the stamp duty deadline at the end of March, there was a noticeable calming during April. House price growth has remained steady, driven by renewed demand for larger properties, particularly those with outdoor space and parking facilities. The average house price in England and Wales now stands at £268,548, reflecting a 4.9% year-on-year increase. Terraced houses have experienced the strongest growth at 5.9%, while detached properties have risen by 4.7%.
The Bank of England has maintained interest rates at 4.5%, which has contributed to a stable mortgage market. Mortgage approvals remain 8% higher year-on-year, indicating continued buyer confidence. However, price sensitivity has increased due to record levels of supply, giving buyers more negotiating power.
Lettings Market Trends
The rental market has seen a marginal return to growth, with prime rental values rising across the UK. Central London rents have increased by 0.3%, while outer London has seen a 0.8% rise. The strongest rental growth has been observed in regional markets, where rents have climbed by 1.3%.
Demand for rental properties remains high, particularly in urban areas where affordability concerns continue to drive interest in renting over buying. The delayed impact of high mortgage costs and rent increases from previous years has contributed to cautious optimism among renters.
The Renters’ Rights Bill is progressing through the House of Lords and is nearing final approval. The bill aims to abolish Section 21 ‘no-fault’ evictions, introduce a Decent Homes Standard, and prevent discrimination against renters with children or pets. It also proposes a Private Rented Sector Ombudsman and a landlord database to improve transparency. While tenant groups welcome the reforms, some landlords warn of unintended consequences, including rising rents and reduced housing supply. Amendments are being debated, with votes scheduled for late April and early May. The bill is expected to become law soon, reshaping the rental market.
Market Outlook
Looking ahead, the UK housing market is expected to remain resilient despite economic headwinds both in the UK and globally. The Office for Budgetary Responsibility forecasts that housebuilding levels could rise to over 305,000 by 2029, up from 244,000 in 2024. This increase in supply may help moderate price growth and improve affordability in the long term.
For buyers, the current market presents opportunities to negotiate favourable deals, while sellers must price properties competitively to attract interest. Renters can expect continued rental growth, though affordability remains a key concern.
Overall, April has demonstrated the adaptability of the UK housing market, with both sales and lettings showing signs of stability and growth. Whether buying, selling, or renting, market participants should remain informed and proactive in navigating these evolving conditions.
Yours
Darren Murphy
