RICS Market Survey February 2024

Please click on the link below to see the latest RICS Market Survey, one of the most comprehensive monthly feedback reports on the market. It is a monthly reflection on the residential market with input from surveyors from around the country, including De Villiers: https://lnkd.in/eHKYWdft
 
2024 has seen a mixed start. Yes, it is certainly much more positive than last year, but it is still a long way from being what would be considered a stable market. Whilst I do not consider the most recent boom market of Q1-Q2 2022 to have been particularly stable either; it was prior to the high mortgage rates, and therefore a much less fragile market situation, than we are currently in.
Unfortunately dropping interest rates to near zero for such a prolonged period means you cannot then increase interest rates to high levels for a sustained period without causing significant economic damage. 
At present there are many Businesses and Homeowners clinging on by their fingertips in the hope the Bank of England will drop rates soon. If, as we all hope the Bank of England, will do this in the next few months, I can see the residential property market returning to reasonable stability, with a greater balance of supply and demand. 
 
At present the low supply is generally sustaining prices, as people are trapped by their mortgage with no viable alternative mortgage product on offer. Once interest rates have dropped, then the market should re-balance. In addition, with lower interest rates, I can also see the much-maligned landlord (being hit again this week by the Leasehold Reform Act) may start to return to the market with a greater and more economically stable balance between Capital Values and Rent Received. This should see rents stabilise and hopefully even reduce, as tenants see a greater choice of property coming to the market.