What will happen to house prices in 2024? Nine views from the UK's top property experts

Savills: ‘Past ‘peak pain’

• UK: -3%
• Prime central London: 0%
• Outer prime London: -2%
• Prime regional markets: -1.5%

Good news predicted by Savills: the agents believe that the UK housing market is past ‘peak pain’. It expects mainstream house prices to bottom out in mid-2024 as affordability pressures begin to ease.

Less debt-dependent prime regional areas (the top 5-10% of a market by value) are tipped to be the first to see house prices recover.

‘Interest rates are expected to have peaked and the worst of the house price falls look to be behind us, but the first cut to rates still looks to be some way off,’ says Lucian Cook, head of residential research at Savills.

‘This means continued affordability pressures are likely to result in further modest house price falls over the first half of 2024, resulting in a peak to trough house price adjustment in the order of -10%.’

Frances McDonald, director of residential research at Savills, says: ‘We continue to expect prime central London to outperform most other UK residential markets over the next five years. With prime property values still well below historic peaks in central London, a recovery looks well overdue.’

Knight Frank: ‘We’ve avoided the worst’

• UK: -4%
• Prime central London: 0%
• Prime outer London: 1%
• Prime country markets: -3%

Knight Frank also believes the worst of the house price declines could be behind us.

Tom Bill, head of UK residential research at Knight Frank, explains: ‘Halifax and Nationwide house price indices in recent months point to a market that is bottoming out. The story of this slowdown so far has been more about a notable drop in transactions rather than prices.

‘The stress-testing put in place after the financial crisis has been working so there are fewer riskier loans. That has protected lenders and helped to keep a lid on steeper price declines.

‘The housing market effectively went into hibernation during the last three months of 2022 after the mini Budget. It came to life in the final quarter of 2023 and that's down to the rosier economic picture. It is the good economic news that has provided a more settled backdrop.

‘I wouldn't be surprised if the housing market in 2024 does better than our forecast.’

Bill expects 2024 to be dictated by events in Westminster not the Bank of England.

He adds: ‘If a general election is called later in the year, it could be a good housing market in the spring. However, if it's called sooner, that could curtail sales activity and there would be less upwards pressure on prices.’

Chestertons: Last pause for breath before rises in 2025

• UK: -0.3%
• Prime central London: 1.8%
• Greater London: 1.8%

Reflecting the ‘sluggish’ economic outlook, Chestertons says its house price forecasts over the next two years are subdued. But it warned that any interest rate cuts or tax incentives could quickly change this.

‘London prices will show growth of 1.8% due to the higher number of cash buyers that are less affected by interest rates,’ says Matt Thompson, head of sales at Chestertons.

‘The prospect of a slightly stronger economic outlook from 2025 feeds through to a more meaningful uplift in house prices. We forecast that this will result in growth of between 3.5% and 4.5% across London and the UK. However, we caution that any house price growth is more likely to be slow and steady rather than spectacular.’

Jackson-Stops: ‘Minor reduction at worst’

• UK: hold firm, with adjustment of up to -5% in some local markets

Jackson-Stops predicts house prices to remain mostly stable this year. Two thirds of Jackson-Stops agents expect prices to hold, while the remaining third anticipate a ‘modest’ decline in prices, though this varies by local market.

Nick Leeming, chairman of Jackson-Stops, says: ‘We expect a minor reduction in property values at worst, under 5% over the year, which will bring some house prices back in line with pre-pandemic levels.’

He continued: ‘With the prospect of interest rates going down next year and a greater pipeline of supply which is likely to increase further in spring, there are reasons to expect a better market emerging as the year progresses.’

He believes that the possibility of a general election in 2024 could prompt buyers to pause and hold off making a long-term commitment until they know more.

Hamptons: Static prices mask 11% real-terms drop

• Great Britain: 0% in Q4 2024

Hamptons says that affordability will be the main driver of house price movement this year. Falling mortgage rates and rising real incomes ‘should mean house price falls stabilise with 0% annual growth across Great Britain in Q4 2024’, it says.

It points out that political uncertainty may weigh lightly on confidence and therefore price growth, particularly in prime areas.

‘On paper, the house price falls we forecast are minor in nominal terms. But high inflation for other goods and services means that in real terms, the average price of a home will have fallen around 11% between 2022 and 2024,’ explained Aneisha Beveridge, head of research at Hamptons, last September. ‘This essentially reflects ‘the correction’ caused by higher rates. It’s also why we expect prices to rise again in both real and nominal terms from 2025 as rates fall to their new normal and a new housing cycle begins.’

Rightmove: ‘Even more competitive pricing’ in some areas

• Great Britain: -1%

Rightmove says that the housing market is continuing to return to more normal levels of activity following the ‘frenetic’ post-pandemic period. It expects average new seller asking prices to be 1% lower by the year-end as competition climbs among sellers.

Rightmove’s property expert Tim Bannister says: ‘In areas where sellers are struggling to attract affordability-stretched buyers or needing to sell quickly due to a change of circumstance, new job opportunity, or strong desire for a lifestyle change, we are likely to see even more competitive pricing.’

Zoopla: ‘UK housing still looks expensive’

• UK: -2%

Zoopla says that affordability remains a key challenge for mortgage-reliant households. Despite the affordability hurdles, the property portal expects first-time buyers to be the largest group of would-be buyers over the next two years, motivated to get onto the housing ladder by rising rents.

Richard Donnell, executive director at Zoopla, says: ‘UK housing still looks expensive by historic standards which is why we expect UK house prices to fall a further 2% over 2024 as prices and incomes re-align.’

Halifax: ‘Continued mild downward pressure’

• UK: -2% to -4%

Halifax says it expects a partial recovery in housing market confidence and transaction volumes this year as interest rates ease and affordability improves.

Kim Kinnaird, director, Halifax Mortgages, explains: ‘Overall, with the combination of cost of living pressures and interest rate levels that are still much higher than even two years ago, we will likely see continued mild downward pressure on house prices.’

Forecast uncertainty remains high given the current economic environment, Kinnaird added.

Nationwide: ‘Subdued activity’ in 2024

• UK: low single digit decline or broadly flat 

A rapid rebound in house prices this year is unlikely, says Nationwide.

‘It appears likely that a combination of solid income growth, together with modestly lower house prices and mortgage rates, will gradually improve affordability over time, with housing market activity remaining fairly subdued in the interim,’ explains Robert Gardner, Nationwide’s chief economist.

‘If the economy remains sluggish and mortgage rates moderate only gradually, as we expect, house prices are likely to record another small decline (low single digits) or remain broadly flat over the course of 2024.’