£ 470, 000 £ 606, 096 - 4. 7% £ 329 £ 956m 67
ORTGAGE AP P ROVALS (DEC)
ENCOURAGING START TO THE YEAR
It has been an encouraging start to the year for buyer activity, with some looking to move before the reduced stamp duty deadline in March. The momentum in sales activity has continued despite mortgage rates remaining relatively high, with moderate price growth expected, particularly in areas with room for growth.
SPRING FORWARD
Spring is the season of new beginnings, bringing fresh blooms, longer days, and a renewed sense of energy that extends to the property market. The lighter, brighter days enhance a home’s kerb appeal and finding a property in spring means you’ll most likely be settled into your new home by summer. Over the last 3 years 27% of sales occurred in spring, the highest of any of the seasons1
February and March are typically the best months to list a home for sale. Two thirds of homes listed for sale in February and March since 2012 have gone on to complete a sale, the most out of any month. Historically, February and January also have the fastest average time to find a buyer at 51 days, with March and April following closely at 52 days2 . In the year so far, the number of potential buyers contacting agents about homes for sale is 8% higher than last year, while the number of sales being agreed is 15% higher2
ECONOMY, IR AND MORTGAGES
The Bank of England has cut interest rates from 4.75% to 4.5%, the lowest base rate since June 2023. The decision comes as inflation slows, to 2.5% in the 12 months to December 2024 (ONS) and the economy shows signs of stagnation. Interest rates are forecast to drop to 3.75% by the end of the year3 . While most of this is already priced into fixed mortgages, we could see some further reductions, however we will not see the ultra-low rates of recent years. Since the beginning of the year the average two-year fixed rate has risen from 5.47% to 5.52%. Meanwhile, the average five-year fixed rate has climbed from 5.24% to 5.33% (Moneyfacts).
INCREASED APPETITE
The number of homes for sale per estate agency branch is at a 10-year high for this time of year, giving buyers more choice and boosting the number of enquiries and sales2 . In Wales, the prime markets of Merthyr Tydfill and Wrexham are currently the best performing.
There is an increased appetite among consumers to move home in the next two years, which bodes well for market activity throughout the year. Around 22% of renters and just under a fifth of homeowners plan to move within this period, while a quarter have no immediate plans but are keeping a close watch on the market in case their circumstances change 4
MODEST PRICE GROWTH
Despite steady sales activity, price growth will be kept in check over 2025, with a modest 3.1% rise forecast3 . This is due in part to mortgage rates stabilising in the 4–5% range and buyers having plenty of homes to choose from. However, the current north-south divide in house price growth is expected to continue in the year ahead.
In Wales, annual price growth is gaining momentum. In Q4 2024 annual growth was 0.9%, an improvement from 0% in the previous quarter (Nationwide). 1Dataloft by PriceHubble, HMRC, spring is March, April, May, 2 Rightmove, 3 Dataloft by PriceHubble, HM Treasury Consensus Jan 2025, 4 Zoopla
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W A L E S P R E M I U M M A R K E T
£197,813
£470,000
£606,096
W A L E S
£200,440
£385,000
£485,997
£136,579
£295,000
£386,406
£151,928
£325,000
£407,856
£315,814
£630,000
£799,113
£204,252
£480,000
£618,446