Housing stock decrease causes increase in demand in UK
The UK residential real estate market saw a rise in demand for property in June while housing stock levels decreased for the first time in four months, according to estate agents.
The latest report from the National Association of Estate Agents (NAEA) shows an increase in the number of house hunters registering with an agent across the country. The figure rose from 265 in May to 279 in June as an average per branch.
The percentage of sales made to first time buyers remained the same as in May at 21%, which suggests that although the increase in the Stamp Duty threshold to £250,000 didn’t affect this category, it might be attributed to aiding the wider buyers market, the report says.
The number of houses available for sale saw a slight decrease from 62 per branch in May to 59 in June while the number of sales fell from eight to six per branch on average.
‘It’’ encouraging to see that increasing numbers of buyers have entered into the market. There is clearly demand for property at present but these figures suggest that the banks are still being restrictive in their mortgage lending policies to buyers,’ said NAEA President Michael Jones.
‘The fact that sales didn’t match this demand is most likely a result of the unclear picture at the start of the month. Buyers and sellers were expecting a hike in Capital Gains Tax (CGT) that although proved less severe than first thought, meant there was a hiatus in activity as both waited for the full facts to be established after the emergency Budget,’ he explained.
He predicts that if the banks ease up on mortgage lending restrictions then the summer months will see the sales figure rise in line with demand. The NAEA’s figures contrast though with ones reported by the Royal Institution of Chartered Surveyors a few days ago.
RICS said the number of surveyors reporting a rise in homes being put on the market had reached its highest level since May 2007, while the number of potential buyers registering with estate agents fell for only the second time since the latter part of 2008.
Surveyors were also pessimistic about the outlook for the housing market, predicting property prices would fall during the coming months as the mismatch between supply and demand, widely seen as a major factor in the housing market recovery, eased.