The January 2024 update on the UK housing market highlights several key trends:

– House Prices: House prices held steady in December 2023, with a slight annual drop of -1.8%. However, there were notable regional differences, with East Anglia seeing the largest decline at -5.2% and Scotland showing modest growth of 0.6%.

– Mortgage Rates: Declining mortgage rates have helped stabilize prices as lenders compete in a slow market. Expectations of an earlier-than-anticipated Bank of England base rate cut, potentially in May, have driven these reductions.

– Economic Outlook: Recent GDP and inflation data revisions have shifted concerns towards the risk of recession, strengthening the case for an early base rate cut.

– Market Activity: Demand in the housing market has been rising, though it remains below pre-Covid levels. Sales agreements and mortgage approvals have increased, with December seeing the highest sales in nine months.

– Regional Variations: Price declines were most significant in the more expensive southern regions, while the North, Midlands, and parts of Wales showed greater resilience.

– Rental Market: Annual rental growth slowed to 9.0% in November, though it remains strong in regions like the South West, North East, and Wales. However, affordability pressures are beginning to slow growth across the board.

This summary outlines the mixed performance of the UK housing market, with resilience in some areas despite broader economic challenges.