London estate agent Foxtons said demand for London home sales had increased in recent weeks as mortgage rates “normalized”, while rents were expected to “remain at historically high levels” through 2024. Ta.
The company added that its home sales division enters the year with “a sales pipeline that is significantly higher than last year despite weak market conditions, which should support good year-over-year sales growth in the first quarter.” Latest trading information on the London Stock Exchange.
The report said: “Buyer demand has increased as mortgage rates have started to normalize, with the first mortgage product released with interest rates below 4% since the September 2022 mini-budget. “We have seen a good level of growth in recent weeks.”
“If interest rates continue to fall, we expect buyer demand to increase significantly further.”
Earlier this week, Nationwide Building Society cut rates on some homes by up to 81 basis points, with minimum prices starting at 3.84%, the lowest level for the institution in eight months. .
The benchmark interest rate was left unchanged at 5.25% in November, the highest level in 15 years, for the third time in a row as the Bank of England aims to bring inflation back below its 2% target (currently 4%). The BoE's Monetary Policy Committee is widely expected to leave benchmark interest rates unchanged again next Thursday.
Foxtons also expects rental rates to remain “resilient” through 2024.
“While rents are expected to remain stable and remain at historically high levels as rental demand and supply dynamics have largely normalized, an improving supply of available rental properties will increase market share. We have a great opportunity to expand further.”
The company said its adjusted operating profit last year was “broadly flat” at around £14m compared to the previous 12 months, but sales rose 5% to £147m.
It added that its rental business, which accounts for around 70% of group sales, increased by around 16%, bringing in revenue in excess of £100m for the first time in the company's history.