Describing the 2024 property market in one sentence, it's fair to say it was 'The Year of Two Halves’. The year started slowly, with the hangover from some disastrous financial and political decisions, combined with high interest rates meaning mortgages remained expensive. This combination of factors meant that buyers and sellers remained cautious, with large numbers of people taking opting for safety first and simply choosing to ‘remain put’.
This resulted in far less transactions in the first 6 months than would normally be expected, especially in months like April and May which are the traditionally busy ones for high volumes of sales. Here at Kelvin Valley, we sold 61% of properties listed locally and achieved a combined total of just over £1.2m above home report value for our clients, meaning that clients who sold with Kelvin Valley achieved the best results by a considerable margin.
Whilst the sales market dragged its feet with less transactions and less closing dates happening, the rental market steamed ahead with rapid growth as rents finished the year 9.6% higher on average than they were at the start of the year. This is something that we often see - when less people are buying and selling, then more people rent which in turn leads to rents going up quickly. Combined with the lack of enough rental properties to go around, it is likely that rents rising is a trend that will continue for the foreseeable future. The Kelvin Valley lettings team rented a very high 70% of rental properties in the local area, with the average time taken to let a property coming in at just under 4 days.
As summer holiday season finished late July / early August, the market improved considerably. Here at Kelvin Valley, our busiest months of the year were September and October when much larger numbers of people than usual decided to move house. There were closing dates aplenty and some outstanding sales results with sellers able to pick from large numbers of high offers due to a sharp increase in demand, especially for family homes in the area. Interest rates were being cut, mortgages were getting cheaper, and there was clearly a lot of pent-up demand from the last couple of years where people were desperate to get moving again.
As always, the property market is driven by supply and demand. There remains a distinct lack of quality properties available for sale in local postcode areas and as a result, that means that most will continue to sell quickly and for good prices. Reports on the condition of the national housing market report that as a nation, Scotland is somewhere around 100,000 houses short of where it needs to be for the population and whilst that remains the case, it is very likely that demand will continue to outstrip supply in the years ahead.
Here at Kelvin Valley, despite a challenging first half to the year, on 67% of properties we sold in 2024 we were able to achieve our clients above home report. Our best result was a sale at £95,000 above value and we did also have some other outstanding results where we achieved tens of thousands more than our delighted clients were expecting due to our comprehensive marketing ensuring high levels of viewings and interest.
As we look ahead to 2025, there is certainly going to be an interesting year ahead for the local property market. Most experts predict that property prices will increase between 2-4% but we have found over the years that most predictions are pessimistic and as an example in 2024 most experts were predicted zero growth with some even predicting price drops. The market then went on to exceed all expectations and prices rose 4.8% in 2024 despite wider political and economic challenges. It is likely that some of these challenges will continue for a while yet, with governments both North & South of the border continuing to make questionable decisions which are affecting the wider economy!
Interest rates set to fall further in the medium to longer term, which will result in mortgages becoming cheaper. It is expected that the base rate will decrease by somewhere between 0.5% - 1% by the end of 2025. The key underlying indicators do point towards a strong market for 2025. More and more buyers will continue to come back into the market each time interest rates drop another quarter percent and we are predicting 3 or 4 of those in the year ahead, meaning the base rate could end up below 4% by year end.
The Kelvin Valley predictions for 2025?
- Property prices will rise by a further 4%
- Rents will increase by a further 6%
- The number of property transactions will be much higher than 2024
- Interest rates will steadily drop throughout the year, with mortgages becoming cheaper
We hope you have found this market summary from 2024 and outlook for 2025 useful. Here at Kelvin Valley we always try to keep our clients as up to date as possible.
Whether buying, selling or renting, our team can provide accurate and up to date information and will be more than happy to assist.
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