The September Housing Market Survey form The National Association of Estate Agents (NAEA) shows that housing market activity continues to improve, with monthly sales increasing from an average of 14.7 per agent in August to 15.2 this month. The number of new buyer applicant enquiries has also jumped to 126 per agent (August = 115) and the number of exchanges increased to 11.8 per agent, the highest since November 2002.
Annual house price inflation rose slightly to 7.6%, up slightly from 6.9% last month. House price inflation has been stable at around 7.5 – 8.5% for the last five months.
The average number of viewings undertaken before a sale is agreed rose to 23 in September, up from 17 in August, reflecting the larger number of prospective buyers rather than any increased time to sell a house – which has remained stable at an average of seven weeks for the last three months.
First time buyers continue to be few on the ground, however, with only 13.6% of sales being accounted for by first time buyers (August, 13.3%), well down on the 21% at the beginning of the year and the typical 25%+ in more ’normal’ years.
Vendors are typically achieving 96% of their asking price (up slightly from 95.6% last month), providing further evidence that the market is improving for the seller.
Melfyn Williams, President of the NAEA comments:
“Despite the absence of first time buyers, the market is remaining healthy, with improved sales and stable house price inflation. Record low mortgage rates and unemployment, combined with rising incomes and consumer confidence are supporting continued house price inflation at rates significantly above retail prices.
We confidently expect to see house price rises continuing over the next 12 months. However, to help the forlorn prospective first time buyer, the Government should consider abolishing stamp duty for first time purchases. Stamp duty on any house purchase is the most unjust and inequitable tax existing in the UK today.
Lenders are showing more flexibility with respect to allowing higher income multiples for first time buyer mortgages. This is to be applauded provided that the higher income multiples apply only to fixed rate mortgages which are immune to prospective interest rises”.
