FTB’s accounted for 16% in January and over 17% in the July survey.
This down turn is reinforced by the response to an additional supplementary question in the month’s survey: Are you seeing a return of first time buyers in the housing market? 57% of estate agents said “no”, 36% said “a moderate increase” and only 7% reported a “significant uplift”.
Meanwhile annual house price inflation continues to fall, to 6.9% this month, following a steady downward trend over the last 12 months and ending a short term stabilisation of prices over the previous 3 months. It is taking more viewings before a sale is secured (an average of 17 in August, 15.7 the previous month), and vendors are only achieving 95.6%. of asking price, compared with 96.6% last months and 98.5% a year ago
Transactions in terms of sales agreed per agent are up slightly, 14.7% against 11.10% last month, but remain significantly below the average of over 20 per agent recorded in the spring/summer period last year.
Melfyn Williams, President of the NAEA, comments: “While the market is not in recession the acute shortage of first time buyers is threatening to log-jam sales in progress higher up the value chain. Without first time buyers the market could falter due to large chains of agreed deals being unable to complete. I call on both the Government and lenders to take action to encourage the first time buyer back to the market. Despite the lowest mortgage interest rates for over 50 years, lenders are being over cautious with the multiples of income they are willing to lend on – especially for fixed rate deals where there is no risk of interest rate hikes. Lenders should also increase their offerings of ‘guarantor mortgages’ where parents can help through guaranteeing repayments of their children’s loans. The Government should also encourage first time buyers, and abolishing stamp duty for first time purchases would be a welcome step. Stamp duty is a totally inequitable and unjustifiable tax on home ownership”
