The total number of residential valuations conducted in March increased by 24% on a year on year basis and 29% month on month. The increase represents the sixth consecutive month of annual growth.
John Bagshaw, corporate services director of Connells Survey & Valuation, said: “The coldest March in over fifty years doesn’t seem to have stalled progress.
“The last time there were this many residential valuations in a single month, HBOS had just announced a £6bn profit and Northern Rock was still vigorously expanding its lending.
“This year confidence in the housing market could be returning cautiously. Certainly if last month’s trend continues the housing market might be looking at a more sustained take-off than the usual spring bounce.”
First time buyer activity in March was also the strongest for six years as a 26% monthly growth brought the number of first time buyers to the highest level since March 2007.
Of all sub-sections of the market valuations on behalf of new buyers showed the fastest year on year growth (33%). This represents the seventh successive month of annual growth for first time buyers.
Bagshaw said: “Improvements are filtering through to more first timers too. Better competition at higher loan to value ratios is starting to make mortgages more affordable for first time buyers.
“The expectation that Bank rates will stay low for many years is also cementing low interest rates but the biggest change is a calmer approach to the risk from smaller deposits.
“Much of that particular progress is down to the latest government intervention. The budget was effectively a re-launch of NewBuy and FirstBuy but there was real change too.
“The timescale is now more realistic with mortgage guarantees until 2017 and there’s the new £3.5bn pound budget for equity loans.
“It will all take time to filter through, and the longer-term economic impact is far less certain. But things are already moving in a much more positive direction.”
Valuations on behalf of home movers increased by 28% month on month and 16% year on year making March 2013 the strongest month for home moving activity since June 2007.
Bagshaw continued: “With prices starting to pick up this could be feeding the optimism of some movers.
“Even if many regions are still seeing negative price growth, the national picture is looking more buoyant.
“On Monday the Royal Institute of Chartered Surveyors announced the strongest quarter for house sales in three years and the more recent picture in March looks even more positive.”
In March the number of remortgaging valuations rose by 25% on both an annual and monthly basis.
This growth brings remortgaging activity to the highest level since March 2008 and represents a five year high.
Buy-to-let reported the strongest rebound of any market sector as valuations grew by 45% on a monthly basis bringing this activity to a level 19% above March 2012.
Bagshaw said: “Lenders are increasingly incentivised to write more loans with smaller deposit, for the likes of first time buyers. But at the same time they’re told to bolster their balance sheets with safer assets.
“Buy-to-let and remortgaging loans are the balancing weights that allow that progress and luckily these loans provide a vital function themselves.
“The buy-to-let industry is increasingly important for the housing market, while a fresh round of remortgaging will help many households lower their repayments and make the monthly financial squeeze a little easier.”
