What buyer trends emerged from the housing market in 2024? Our internal data paints a revealing picture.
The past year brought significant developments in the property market. Decreasing mortgage rates and lower house prices led to a noticeable increase in housing demand and property transactions.
Analysing our client data from 2024, we can clearly observe how home-buying behaviours shifted during this period. Here’s what the numbers reveal…
Essential Home Buying Home Buying Insights from 2024
- First-time buyers made up 71% of Bird & Co’s clients, up from 68% in 2023.
- 29% of buyers already owned a residential property.
- 81% of buyers purchased properties as primary residences, up from 78% in 2023.
- The proportion of buyers purchasing new builds has slightly declined, falling from 11% in 2023 to 10% in 2024.
- Around 1 in 3 properties in 2024 were purchased for business purposes; a consistent figure from 2022.
- 11% of buyers had partners who already owned another property, reflecting a decline from the 13% recorded in 2023.
- 56% of buyers stated that they were purchasing a property for the first time with the intention of making it their primary residence.
What Can We Learn from 2024 Housing Market Data?
Interest in the Construction of New Builds Continues to Decrease
The data indicates a pattern of decline in the percentage of people purchasing new builds in 2024. This percentage has dropped year on year, with the following figures over the previous four years:
- 2021: 14.35%
- 2022: 13.68%
- 2023: 11.18%
- 2024: 10.39%
These figures are somewhat surprising considering the government’s plan to build 1.5 million new homes within the next five years. This plan was brought in with the aim of accelerating housebuilding in regions with the greatest demand, enabling more individuals to achieve homeownership while stimulating economic growth nationwide.
However, our figures do not appear to reflect the effectiveness of this incentive.
Statistics on First-Time Vs Second-Time Buyers in 2024
The percentage of buyers who owned another residential property decreased from 32% in 2023 to 29% in 2024. This appears to be a pattern, as we witnessed a small decrease between 2022 and 2023 from 32.36% to 31.94%.
The decline in buyers already owning a residential property may be linked to the growing challenges of being a landlord, particularly the requirement to meet the government’s new Energy Performance Certificate (EPC) standards by 2025, necessitating costly energy-efficient upgrades.
In fact, the percentage of buyers planning to let their properties has steadily declined, dropping from 17% in 2022 to 13% in 2023, and further to 12% in 2024. At the same time, 4 in 5 buyers said they intended to use the property as their main residence.
Meanwhile, the proportion of first-time buyers has risen from 68% in 2023 to 71% in 2024. This increase could be linked to lower mortgage rates and reduced house prices this year. Additionally, the government’s Lifetime ISA scheme, allowing first-time buyers to save up to £4,000 annually until the age of 50 with a 25% government bonus (up to £1,000 per year), has further enhanced the affordability of homeownership for this group.
Reasons for Purchasing a Property in 2024
A closer examination of the reasons behind purchases in 2024 reveals the following data:
- 30% of prospective buyers purchased properties for business purposes
- 1% of buyers purchased homes to use as HMOs
- 1% of buyers purchased homes to use as holiday lets
The most staggering of these results is the large percentage of properties bought for business purposes.
The number of individuals buying properties for business use saw a significant increase, jumping from 15% in 2021 to 33% in 2022, more than doubling over the course of a year. This proportion then saw a modest decline, dropping to 31% in 2023 and 30% in 2024. Despite this reduction, the figure remains notably high.
Therefore, despite the rise in modern work-from-home trends, our internal statistics demonstrate that there continues to be a demand for commercial properties and office spaces post-pandemic.
Our data also reveals that only 9% of properties were purchased by companies in 2024, a slight increase from 8% in 2023. This may suggest that a significant portion of the 30% of buyers acquiring properties for business purposes consist of independent commercial landlords with the financial resilience to navigate and comply with the new EPC regulations, while seeking to lease office spaces.
Decline in Purchases Made by Non-UK Residents
The percentage of purchases made by non-UK residents fell from 4.24% to 3.51% between 2023 and 2024. Several factors could explain this trend:
- The cost-of-living crisis may have diminished the UK’s attractiveness as a property investment destination.
- The aftereffects of Brexit may still be shaping international views of the UK market, with concerns about the stability of long-term investments lingering.
- For non-residents buying properties to let, the challenging economic climate and rising compliance costs, such as those related to EPC regulations, could undermine the profitability of such investments
Navigating the Housing Market in 2024
The 2024 housing market data highlights several key trends reflecting shifting buyer priorities and market challenges.
Interest in new builds continues to decline despite the government’s 5-year plan, and purchases by non-UK residents have also fallen, potentially influenced by economic and regulatory pressures.
First-time buyers now account for a larger share of the market, supported by lower mortgage rates, reduced house prices, and government incentives like the Lifetime ISA scheme.
Meanwhile, a notable proportion of properties are being purchased for business purposes. Our data highlights the ongoing demand for commercial spaces, with financially capable landlords perhaps recognising office rentals as a valuable and profitable investment opportunity.
These insights underscore the evolving dynamics of the housing market and the influence of economic, regulatory, and personal factors on buyer decisions.
What Lies Ahead in 2025?
As 2025 progresses, the housing market is expected to remain positive, influenced by lower interest and mortgage rates and relatively stable house prices. The rental market, on the other hand, is expected to experience a continued decline as persistent cost-of-living challenges and new energy regulations will likely provoke landlords to continue to sell up.
Moving forward, government policies will likely heavily influence market trends, emphasising the importance of strategic and well-informed decisions for buyers, sellers, and investors alike.
What Should the Government Prioritise in 2025?
Current Government Plans
Two government initiatives - already set to take effect in 2025 - are expected to impact the housing market in 2025:
Stamp Duty Land Tax Changes
In September 2022, the government implemented temporary adjustments to Stamp Duty Land Tax (SDLT) to boost property transactions, which the COVID-19 pandemic had significantly impacted. These measures were announced to remain effective until March 31, 2025. As these changes are set to be reversed in the coming months, they are likely to create challenges for some individuals attempting to enter the housing market.
Labour Budget Changes
More positively, in its Autumn Budget, the Labour government unveiled a £5 billion funding initiative to support its ambitious housing plan. A key component of this plan is a £500 million allocation for an Affordable Homes Programme.
Suggested Further Government Plans for 2025
Our internal data suggests that current programs, such as the Lifetime ISA, positively influence first-time buyers’ ability to enter the property market. Conversely, the proportion of second-time buyers has declined, as the appeal of becoming a landlord has diminished due to new EPC regulations and rising living costs. Consequently, the rental market is facing challenges.
With renting becoming increasingly costly and less accessible, it is essential for the government to take steps to make the property market more inclusive and attainable for a wider range of individuals. Additionally, the ongoing decline in new build construction highlights the need for strategies to foster a more supportive environment for new developments.
Outlined below are several potential actions the government could take to enhance the property market in the year ahead:
- Work towards further reducing interest rates to drive down mortgage costs.
- Address and alleviate the cost-of-living crisis.
- Introduce additional incentives to encourage saving.
Considering a Home Purchase in 2025?
The housing market for 2025 looks optimistic. There is reason to believe that mortgage rates will maintain the decreasing pattern established in 2024, which will likely spark an increase in housing transactions.
Our internal data reveals a rise in first-time buyer purchases over the past year, and continuation of lower mortgage rates are anticipated to support continued growth in first-time buyer activity.
If you’re planning to buy or sell a property in 2025, the Bird & Co team is here to assist. Visit our website to request a conveyancing quote—we’re ready to help make your dream home a reality.
Methodology
These statistics have been sourced from Bird & Co’s internal database. The data has been collated from client form fillings. Any conclusions drawn are the interpretations of the Bird & Co researchers.
Please note, the researchers have taken each form question answer at face value. In cases where the client may not have filled out a question, we have taken the stats from those who have answered. Any discrepancies between question answers may be attributed to this.