The number of valuations in March rose 8% year-on-year and grew by 21% compared to February of this year, figures from Connells Survey & Valuation suggest.
The number of valuations in March rose 8% year-on-year and grew by 21% compared to February of this year, figures from Connells Survey & Valuation suggest.
The surveying firm said this was primarily due to the first-time buyer sector posting strong monthly and annual growth figures, making up for a dip in the number of buy-to-let valuations.
In March, the number of valuations carried out for those taking their first step onto the property ladder increased by 41% compared to the previous month and 15% compared to March 2015.
The first-time buyer sector’s vigorous performance helped counteract a dip in buy-to-let activity in March, as the 3% stamp duty charge on second homes– that took effect on 1 April – drew near.
John Bagshaw, corporate services director of Connells Survey & Valuation, said: “March’s solid topline figure demonstrates the hardiness of the housing market, largely driven by first-time buyer activity.
“Increased determination on the part of this once-cautious sector, alongside a brightened economic outlook compared to a few years ago, have certainly been key drivers in activity.
“However a significant reason for the first-time buyer resurgence is the increased uptake of government plans designed to assist the bottom of the market.
“The Help to Buy scheme has become more widely recognised and used by those who need a little help getting the capital together to fund a mortgage for a first home.
“Equally, more first-time buyers are taking advantage of special first-time buyer discounts on certain properties, which has helped those on lower incomes step onto the ladder.
“While first-time buyer confidence continues to flourish, there’s every reason to be optimistic about the path the housing market is on.”
Remortgagors and home movers have also seen a significant boost in valuation activity in March, which has kept the housing market on course in the run-up to the stamp duty change.
Total remortgaging volumes represented an increase of a quarter (25%) on February 2016, as well as reflecting a jump of a third (33%) on March 2015.
Home mover valuation activity grew by 4% in March on a year-on-year basis and leapt by 27% compared to the previous month.
Bagshaw added: “The rates of growth have come down somewhat from what we were seeing in previous months, as those looking to remortgage to fund a second home take a step back to re-assess and absorb the stamp duty changes.
“But with the average mortgage rate still very low – and no Bank of England rate rise on the horizon – many are taking advantage of the bargain rates in order to release capital on their home or switch to a better mortgage deal.”
The stamp duty changes, which became effective on 1 April, impacted the buy-to-let market in March.
Valuation activity in this sector dropped by 27% between February and March 2016, as well as dipping by 36% compared to the same month a year ago.
Bagshaw said: “The buy-to-let market has endured a turbulent month but we expect this to be a short-term tumble.”
