Your Watford & Hertfordshire market report

As spring arrives, the housing market continues to return to life. Rightmove reports that asking prices were up 0.9% in February, and after several months of rises, most of the major indices are now showing annual growth has moved into positive territory. Activity levels are increasing, too, with the number of agreed sales up by 16% compared to the same period last year and by 3% compared to the more standard 2019. At the same time, buyer choice is also improving, with a 7% rise in new listings on Rightmove.

Matthew Marchant, Rolstons' Director of Sales, says:

“We said that February would be an important indicator for the year ahead, and the question was whether the Rightmove Boxing Day bounce in buyer activity would keep its spring into March or lose momentum. It’s proved to be the former, with the number of sales agreed continuing to outstrip last year considerably. Early-bird Boxing Day buyers got a head start in cherry-picking from a record level of new property choices and have now been joined by many other buyers also believing that 2024 offers the right market conditions to move.”

The drivers of all this increased activity are clear – buyers’ confidence is rising on the back of mortgage cost falls. However, mortgage rates are still some way above recent averages and there is uncertainty over when and how much they will come down. This means that buyers remain cautious, and some wait for the base rate to fall before moving. This more careful approach means property is taking over two weeks longer (16 days) to find a buyer. At an average of 78 days, it’s at its slowest since 2015, and anything overpriced is struggling to find any buyers.

First-time buyers (FTBs) are finding the conditions the hardest, and despite the soaring costs of rents, higher mortgage rates mean it is considerably more expensive to buy than rent for the average FTB. However, with an election looming, the government may be keen to boost them, and it would be no surprise if they launched some first-time buyer schemes in the coming months.

Rental & Buy To Let Market

Just as the housing market is warming up, the rental market is continuing to cool down. Although the average rent was up by 0.2% to £1,262pcm last month, stretched affordability meant rents fell in 4 out of the 12 regions. And, as has been the case for some time now, they came down most in London, dropping by 0.5% to £2,070pcm. On an annual basis, the Capital’s rents were still up by 4.8%, but that is compared to 7.4% across the UK, and that figure has been coming down for several months. It is a very mixed picture, with some London boroughs seeing falls rather than gains. Camden’s rents, for example, were down by 3.6% and Tower Hamlet’s by 1.8%. In contrast, Barking, Dagenham and Havering’s were up by 11.8% (source: Homelet Rental Index)

Despite the softening of rents, the supply of rental property remains challenging. Some minor improvements have occurred, but tenants must still compete for any available properties. Michael Gove hopes that by removing the tax breaks from short holiday lets, some landlords may opt to put their properties onto the standard lettings market, but that remains to be seen, and the numbers are likely to be insignificant.

If you'd like to talk to an agent for more personalised advice, our team are always on hand to help. We'd love to hear from you, whether just a quick chat or a no-obligation property valuation.

Warm wishes,

The team at Rolstons.