Reflecting Q1 2024

Where have the past 3 months gone?

Looking back since the beginning of this year a lot has happened here at Chesterfield Gordon but also in the wider economy. We have reviewed the recent housing data from many sources and have been digesting it.

So, what has happened in Q1?

According to the Office of National Statics (ONS) & Bank Of England (BOE) data both showed mortgage approvals were up in February 2024 to 60,000. To put this into context a “normal” or “healthy housing market” sees 65,000 to 70,000 mortgage approvals per month!

Could we see this go up later this year?

The short answer is very likely! This is for various factors in the wider economy. Firstly the S&P Global Composite PMI has reported the UK economy has returned to growth in Q1 2024. This has brought much needed confidence to the housing market as we saw a lot of sales activity last quarter.

In addition food and energy (core) inflation has fallen for 10 consecutive months and is (apparently) at their lowest level in 10 years according to the British Retail Consortium.

This is positive news as it means the inflation target the BOE is aiming for is in sight and there is now more pressure to reduce the base rate. All of us at Chesterfield Gordon are anticipating a small cut of 0.25% in June which will likely make for a very busy summer this year.

James Sproule the Chief Economist for Handelsbanken UK recently stated in an event we attended that “now is the best time to buy before rates go down and property prices increase.” According to their data they see the “new norm” of the base rate staying at the 4/4.5% level.

On the 28th March Rightmove reported the highest number of new sales instructions being the 3rd highest level since 2020. This is a further assurance that buyers and sellers are giving their vote of confidence to the housing market.

The property market is likely going to have a busy next few months this year.

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