North West housing market outlook for 2024 — cautious optimism ahead of the Spring Budget and General Election

We recently convened housing market experts from across the North West at our event ‘Public sector funding — unlocking opportunities and making homes happen’ to get their view on what’s in store throughout 2024 (and beyond).

Our speakers included Marcus Dixon (Director of UK Research, JLL), James Lockwood (Head of UK Regions, JLL Residential Value & Risk Advisory), Eamonn Boylan (Chief Executive, Greater Manchester Combined Authority (GMCA) and Transport for Greater Manchester) Laura Blakey (Investment Director, Greater Manchester Combined Authority) and Brian Burt (Head of Development Finance, North West and Midlands, Homes England) as well as our very own CEO Robert White.

Here, housing and regeneration expert Ellen Hawthorne provides an overview of the key takeaways from the event, including the consensus feeling about where the market is headed during the coming year.

Cautious optimism

While 2023 was a better year than expected for the housing market, it may still suffer the effects of the events in late 2022 for a few years to come.

The outlook for the North West housing market for 2024 is, however, (cautiously) optimistic — and while it’s expected to dip a little in the first half of 2024, it’s hoped that things will pick up again towards the back end of the year. 

Mortgage rates are likely to continue to drop throughout the year — which will be encouraging to buyers — but new housing developments remain scarce and the buy-to-let market may continue to shrink, as we saw in 2023. 

The first-time buyer market has remained resilient over recent months and 2023 saw an increase in cash purchasers — likely a result of the current rental market being so competitive.

In Manchester city centre, specifications and amenities at new developments were said to be improving, though buyers generally seem to be opting for cheaper and/or smaller properties. 

With residents returning to the city, rents were up 51% in 2023 when compared with 2019 due to a perfect storm of lack of stock and high demand. The city centre market is expected to remain strong throughout 2024, with the rental sector set to grow further. 

Looking beyond the centre, opportunities for regeneration and placemaking are also abound in Greater Manchester — particularly in key development areas like Oldham, Old Trafford and Bolton. 

All eyes are currently on the Spring Budget in the hope of renewed support from the Government to boost the housing market and economy. In the run up to the General Election, we can also expect the proliferation of manifesto-promised policies that are intended to boost the economy, ease the cost-of-living crisis and bolster the housing market. Only time will tell if those promises become reality.

Slow year for new housing developments

It may be a slow year to come for new housing developments, with ever-increasing build costs looking likely to continue and reports of limited land opportunities across the sector. 

There are also concerns around the potential cost implications of the 2025 Future Homes Standard, which could see premiums added to house prices to offset the additional costs incurred by developers in complying with those requirements. 

However, inflation is expected to remain on a downward trajectory, which could result in a greater appetite for funding.

Funding opportunities are available

Funding opportunities and schemes are available with the GMCA and Homes England. 

Our speakers were keen to stress that funding is available for schemes of varying sizes and complexity (including for ‘tricky’ sites) — and that both established developers and new entrants to the market are equally welcome to apply. 

Homes England noted that the timeframe from engagement to the grant of funding has been as short as 54 days. This particular example saw funding granted to a new entrant to the market where no upfront due diligence had been carried out. 

The key takeaway message for those looking to explore these funding opportunities was to engage as early as possible on any proposed scheme with Homes England or your local authority. This will help to smooth the path of the development programme. 

Developers should also engage with and assemble the best professional team possible. Under particular scrutiny for causing unnecessary delays in the funding process are developers who engage with solicitors that lack the relevant experience in real estate and banking law to effectively manage and assist with the acquisition, funding and sales process. 

Collaboration is key

Across the board, there is a general need for more investment and placemaking across the entire North of England — with both private and public sector engagement required to help overcome the challenges that the housing market will face throughout 2024 and beyond. 

The spirit of collaboration — required to align ideas, ambition and investment opportunities — will be critical to unlocking the potential of the housing market. This is a central theme of our True North network, which we encourage you to join. 

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Our full-service housing and regeneration team advises registered providers, housebuilders and private landlords at every stage of the housing project lifecycle — from governance, funding and acquisition to disposals and asset management.