2023 review

The housing market responds vigorously to economic, social and political factors. And is ultimately determined by consumer confidence. We have seen this writ-large in the last year.

The final quarter of 2022 was challenging. The traditional Autumn housing market activity ground to an immediate halt after the disastrous Liz Truss and Kwasi Kwarteng ‘Mini Budget’, which resulted in a sharper increase in the bank base rate and mortgage interest rates with the average 5 year fixed rate going from 2.5% to 6.5%. The cost of living increase and Russia’s invasion of Ukraine compounded the collapse in consumer confidence.

Q1 in 2023 saw an increase in activity with the release of pent-up demand from those who had put off moving in the Autumn. The number of applicants registering went up and the Spring housing market through March and April returned to pre-Covid levels. However, as bank interest rates continued to increase through Q2, the demand waned and the number of active buyers decreased. Property sales in Henley were steady during this period, but fewer buyers competed for each property, so house prices plateaued.

Q3 and Q4 has seen a general increase in activity level, resulting in strong sales patterns, particularly in properties priced between £500,000 to £1,000,000. This was largely due to the holding of the bank base rate, which in turn has lead to improved consumer confidence. Additionally, mortgage lenders appear to be more competitive to try and tempt borrowers back into the market.

Forecast for 2024

Off the back of a fairly brisk Autumn, I believe the housing market will bounce back in the early months, after the Christmas lull. This will be due to continued consumer confidence as the bank base rate continues to remain level. This optimism is modest, however, reflecting the ongoing cost of living increases and the turmoil in the global political arena. 

2024 could also be a General Election year, which has historically dampened down the housing market. It could be the case that the majority of buyers and sellers will want to get their house move done before the election. But an election could also spur a nationwide optimism that much-needed socio-political change is afoot. The latest date an election may take place however, is the end of January 2025.

At Philip Booth Esq we are fortunate to have a very robust inventory of properties listed on our website for sale, and many more being lined up to come to the market in the early part of the year.