The Housing Market Activity Report showed the total number of residential valuations conducted by Connells in October was 7% higher on an annual basis.
This followed a smaller than normal seasonal monthly contraction from the September peak.
While activity fell by 8% on a monthly basis it was a much gentler decrease than the average drop of 23% between September and October since 2007.
John Bagshaw, corporate services director of Connells, said: “After a September peak the valuations market has weathered the usual October slowdown and it is encouraging that activity is ahead of last year’s level.
“The recovery isn’t set in stone by any measure but a stronger than expected showing from first-time buyers offers a comforting glimmer of hope.”
And Bagshaw was optimistic about the effects of the Funding for Lending Scheme.
He said: “It should really start to feed through to borrowers over the next three months and if more funds reach those at the bottom of the market we could see overall buyer numbers return to a healthier level.”
The results showed first-time buyers were crucial to the wider annual improvement with valuations for new buyers up 21% compared to last October.
Despite the expected monthly slowdown numbers of first-time buyers fell by only 10% compared to the historic average fall of 28%.
Bagshaw added: “First-time buyers are the lifeblood of the housing market and recovering numbers compared to last year is a step in the right direction. Any sustained and tangible growth in transactions will be tied to prospective first timers’ ability to access the finance they need to move.”
Buy-to-let was another sector which showed strong annual increases with the number of valuations rising by 10% compared to October 2011.
While valuations for new buy-to-let mortgages showed a monthly fall of 6% buy-to-let remortgaging was up 11% from September levels.
“At present buy-to-let landlords with low loan to values are taking advantage of favourable interest rates available to refinance or expand their portfolios,” said Bagshaw.
Home moves and remortgaging were the slowest sections of the valuations market in October.
Numbers of homeowners moving showed a 4% monthly dip representing a 4% fall on an annual basis and although remortgaging activity fell by 9% from September it was still 5% higher than in October 2011.
Bagshaw said: “In many areas values are still below what homeowners originally paid for their property and this will remain a drag on both moves and remortgages. Tight criteria are also limiting remortgaging even though rates remain extremely competitive in general for those who do qualify.
“However the publication of the final Mortgage Market Review has removed a source of uncertainty for lenders and may allow them to loosen mortgage criteria as a result. On top of this participation in the Funding for Lending Scheme is growing with the number of lenders involved swelling to 30. This is an improvement which could help boost remortgaging over the medium-term.”
