Recent data reveals a resurgence in the housing market, fueled by a competitive mortgage pricing battle. December saw the highest number of newly agreed sales since March 2022, as reported by the Royal Institution of Chartered Surveyors (Rics).
There has been a consistent increase in buyer inquiries for four consecutive months, reaching a peak not seen since April 2022. This period marked the initial impact of rising interest rates and the cost of living crisis on buyer interest.
This renewed market vigour is attributed to a significant reduction in mortgage rates towards the end of the previous year. This change occurred as financial markets anticipated potential interest rate cuts by the Bank of England.
As December concluded, the average interest rate for a two-year fixed mortgage had fallen to 5.94%, a decrease of almost one percentage point from its summer peak.
This year has seen lenders further reduce mortgage rates, with some high-street lenders now offering deals under 4%.
Tarrant Parsons, the senior economist at Rics, commented, “With the recent reduction in mortgage interest rates, we’ve seen a stabilization in buyer demand. This is anticipated to lead to a modest upturn in residential sales volumes in the upcoming months.”
