A prominent housing market analyst says people shouldn’t bother reading election literature but instead study interest rates if they want to see what’s happening in the housing market.

The comment – from Tom Bill, head of UK residential research at Knight Frank – comes in response to the Zoopla housing market snapshot, out today. This shows a big rise in the supply of homes for sale – 20% up on this time last year.

This is likely to keep capital appreciation muted this year warns Zoopla. 

The portal says the growth in supply, which is now at an eight-year high, has been driven by a rebound in the number of three and four-plus  bed homes for sale as existing owners return to the market and feel more confident to move. The average estate agent office has had 31 properties for sale, compared to 26 properties this time last year. 

While most homes for sale are new to the market, 31% of homes for sale were marketed in 2023. Rising mortgage rates saw demand weaken, but homeowners have now returned to the market to seek a home move. 

This increase in the supply of homes for sale boosts choice for buyers and is expected to keep house price growth in check over the rest of 2024. Sales agreed are up 13% year on year, but across most regions the growth in new homes for sale is outpacing the growth in the number of sales being agreed.

Zoopla says the General Election in early July is expected to have a modest impact on housing market activity. 

There are currently 392,000 homes in the sales pipeline working their way through to completion over 2024. An increase in fall-throughs is unlikely due to the election announcement as there is not a huge divide in policy between the two main parties. 

This has prompted Knight Frank’s Tim Bill to say: “Growing supply is one reason that UK house price growth this year will be limited to low single digits. However, the main obstacle for buyers is stubborn services inflation, which is keeping mortgage rates high. Asking prices therefore need to reflect the fact that buyers have more choice and tighter budgets. General elections don’t tend to impact mainstream property markets and if anyone is attempting to guess what happens next to house prices, I would suggest looking closely at the next inflation data rather than the manifestoes.”

And Nathan Emerson, chief executive of Propertymark, says this in response to the Zoopla data: “It’s extremely positive to see such a sizable uplift in the market across the last twelve months. However, with a general election now confirmed, until there is full clarity on the direction any new government intends to take regarding housing, we expect there to be a temporary slowing across the summer months of both people choosing to sell their property and those actively looking to buy.

“We do have the positive news that inflation is now firmly tracking downwards and would be keen to see interest rates follow. We are hopeful across the coming months that lenders will bring both competitive and targeted deals to the marketplace at the first opportunity.”