Housing stock down 50% in 10 years
Worrying new data from the National Association of Estate Agents has shown that the supply of available housing has almost halved in ten years.
The average number of properties available per member branch in December 2015 fell to 37 properties; the joint lowest figure for 2015 (joint with September), and almost half the number available in December 2005 when there were an average 72 houses per branch. There were 45 houses available in December 2014.
While the number of house hunters registered per branch fell to 374 in December from 403 last month, an expected seasonal trend, the number of house hunters per branch has gradually increased year on year. In December 2014, there were 360 potential buyers registered at each branch, up from 302 in December 2005.
Low supply affected the number of sales in December, as NAEA members reported an average of seven sales per member branch – an expected seasonal dip, and the lowest recorded in 2015.
Mark Hayward, managing director of National Associate of Estate Agents, comments: “Whilst we expect figures for supply and demand to be seasonally low in December, 2015 overall does not paint a positive picture for the housing market. Supply of housing is half of what it was ten years ago, yet the number of home buyers on the books has been gradually increasing. When there is such a huge and widening gap between supply and demand, a level playing field seems further out of reach for many would be house buyers.”
First time buyers continue to struggle
The Government’s recent efforts to help first time buyers (FTBs) enter the property market such as Help to Buy and plans to build new starter homes are yet to take effect. The number of sales to FTBs stands at a quarter (24 per cent), a two per cent drop from December 2014.
Flux in activity ahead of stamp duty reforms
The recent buy-to-let reform of a three per cent increase to stamp duty on buyers’ second properties has created movement in the market. 44% of NAEA agents have seen an increase in house buyers trying to beat these reforms, and snap up their properties before they come into force in April.
Mark Hayward continues: “The issue of lack of supply needs to be solved, but it isn’t going to be done anytime soon. We are still waiting to see new homes being built; and whilst we wait, house prices continue to rise. There is some potential light for first time buyers however, once the new tax rate increase in April is in place we may see less investment from buy-to-let or second home investors, which may mean less competition for first time buyers.”