In its latest House Price Index, the property portal revealed that rising incomes combined with average mortgage rates at their lowest for two years have boosted sales.
Despite this rise, house prices are still increasing slowly, up by just 1% over the last 12 months to £267,500, as a greater choice of homes on the market and affordability pressures are holding down buying power.
Property price winners and losers
House prices are rising at an above-average rate in more affordable areas, for example the North-East (2%), Yorkshire & Humberside (2%), North-West (2.3%), Scotland (2.4%) and Northern Ireland (5.6%).
At the other end of the scale, house prices are down slightly in more expensive locations, including Eastern England (-0.3%) and the South-East (-0.1%). UK house prices remain on track to be 2% higher over 2024 as price falls from this time last year drop out of the annual rate of price inflation.
Large sales pipeline valued at £113bn
Continued growth in new sales over 2024 has led to the largest sales pipeline the market has seen for four years. Zoopla said there are currently 306,000 homes working their way through the buying process to completion, 62,250 (26%) more than 12 months ago.
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The total value of these sales is £113bn, 30% higher than this time last year.
Momentum in new sales remains strong and looks set to continue into December, supported by a high supply of homes for sale. Many of the most recent sales will complete in the first half of 2025.
First-time buyer boom
First-time buyers are set to be the biggest buyer group of the year, accounting for 36% of all sales followed by existing homeowners (31%), cash buyers (27%) and landlords buying with a mortgage (7%).
Richard Donnell, executive director at Zoopla, said: “It is positive to see the sustained increase in sales activity over 2024 which reflects growing confidence amongst buyers and sellers supported by lower borrowing costs and rising incomes. Overall, the market remains on track for a modest 2% price increase in 2024 and 1.1m sales.
“First-time buyer numbers have recovered as mortgage rates have fallen but a sizeable deposit is still required to buy. Possible changes to stamp duty relief will only create further barriers to ownership for this group who already face significant affordability constraints.”
Sarah Coles, head of personal finance at Hargreaves Lansdown, added: “This is the year of the first-time buyer, as the horror of renting is persuading more tenants to take the leap into home ownership.
“Rents have been driven up and mortgages rates are dropping, so that owning a typical first-time buyer home is now 17% cheaper than renting.”
