New buyer activity leaps 35%

New buyer activity leaps 35%

The number of new buyers has sky-rocketed 35% in the last year and has increased 4.9% on the month.

The supply of new homes has risen substantially on an annual basis, up by up 7.9% but has declined 0.5% since December 2015. The disparity between supply and demand means there are now more than 15 buyers chasing every property on the market, up from less than 12 in December.

Viewings have increased 7.4% on the month as the festive season is left behind and vigour returns to the property market. However, over the same time period sales have shrunk by 14.7%. This is because there are not enough specialists such as surveyors and lawyers to cope effectively with the renewed levels of activity.

The number of first-time buyers entering the market surged 26.1% annually in January and rose 4.8% on the month. First-time buyer house prices rose 6.8% annually and 2.3% on the month to reach £174,804, a record high.

Following this, the average first-time buyer deposit rose 4.3% on the month and 5.2% on the year, and the average mortgage increased 1.9% on the month and 7.2% annually. First-time buyers in January made up 38.6% of mortgages written, down from 41.7% a year previously.

National

January 2016

% change since December 2015

% change since January 2015

Ave UK house prices £

(SSTC)


£225,914

-3.9

10.1

Ave FTB house prices £   

(SSTC)

£174,804

2.3

6.8

London house prices £

(SSTC)

£570,821

0.9

18.9

House sales (exchange)

50,152

-14.7

-7.5

Ratio of new buyer demand to property supply

15.2:1

29.2

25.2


The average property price in London has increased by 18.9% annually and 0.9% on the month to an average of £570,821. The London property market saw activity spring back to life in January with the number of new buyers up 14.4% annually and 5.9% on the month. Meanwhile the number of new properties for sale surged by 19.7% in the year. The number of first-time buyers rose 5.4% on the month and 3.4% annually in London and this should be bolstered in the coming months by Help to Buy London.

Paul Smith, CEO of independent estate agents, haart, had this to say: “The property market in the new year has got off to a flying start with a surge in buyer registrations and new property instructions. The number of new homes coming on the market is up by a healthy 8% compared to a year ago but demand has surged by 35% over the same time period with buy-to-let investors responsible for a large proportion of this rise in anticipation of the stamp duty surcharge.

This high level of activity has resulted in a substantial backlog of homes in the pre-completion stages, and we’re now seeing a shortage of conveyancers and lawyers to progress these sales, leading to delays and a subsequent decline in the number of completions in January. Across the UK, we’re now seeing more than 15 buyers chasing every property to come onto the market and house prices have subsequently risen by 10% annually.

London is also seeing a high level of activity and finally the issues surround the supply of homes is starting to ease with a 20% increase in instructions registered compared to last year. In fact supply is now beginning to outpace demand which is up by 14% over the same time period. While this increase is very welcome, we are still seeing nearly 21 buyers for every instruction despite the slow-down at the top end of the market.

First-time buyers have started the year enthusiastically with demand for starter homes up 26% annually. This is just the start of an upward trajectory for first-time buyers as the 3% stamp duty surcharge for buy-to-investors, due to be introduced in April, will mean less competition for homes.”

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Tony Gimple 09 Dec 2017

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Evelyn Attwood
Evelyn Attwood 01 Dec 2017

It's normal. If you plan to buy a house in one of the most beautiful spots in the country you should pay a high price.

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Evelyn Attwood
Evelyn Attwood 01 Dec 2017

I think that the situation will be the same at December.

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Scott Garnet 06 Nov 2017

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richardrawlings
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What has not been mentioned here is the effect of not only higher interest payments, but also that these payments are less likely to be offsettable as a business cost due to the scaling back of mortgage...

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Kelvin Lloyd
Kelvin Lloyd 09 Oct 2017

IT is up, to the Planners. If they will only give permission for bungalows on certain (suitable) sites, they will be built.

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maggie swift
maggie swift 09 Oct 2017

It's just the beginning of the shocking rise.

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maggie swift
maggie swift 09 Oct 2017

I have recently read that the bungalows can provide social housing for elderly residents in London.

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zoe glover
zoe glover 05 Oct 2017

Update! Worst company I have ever dealt with. Undervalued a Cambridge property by over 100k, wont take on any evidence of valuation including a RICS valuation done 3 years ago for the very same value...

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Paul Edwards
Paul Edwards 27 Sep 2017

Its nonsense articles such as this that make it harder to get clients to realise just how difficult the market is out there. When you see Rightmove and there are more 'price reduced' then 'new' most days...

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Tom Allen
Tom Allen 20 Sep 2017

Absolutely agree with you!

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RyanGeo
RyanGeo 18 Sep 2017

A sharp correction would be a less dramatic expression to use. That is already underway in certain sectors in Reading where I practice as Chartered Surveyor

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