The latest Housing Market Report from the National Association of Estate Agents (NAEA) has confirmed that Stamp duty reforms announced at the start of December helped to boost the middle market and encourage prospective home buyers.
NAEA member agents recorded the highest level of registered home buyers per branch in December for 10 years, while agents reported they saw a rise in the number of properties sold in the bands of up to £250,000, and £251,000 to £925,000.
NAEA members reported the number of house buyers registered in December was on average 360 per branch, the highest level for this time of the year recorded in the last 10 years. The last time the number of house buyers registered per NAEA member branch was this high for December was in December 2004, in which 360 house hunters were similarly recorded.
The NAEA said the seasonally high figures suggest the changes made to stamp duty announced in December helped to encourage prospective buyers in a typically quieter month for the housing market.
In addition, NAEA member agents reported some positive movement in the middle market, with 19% saying that they saw an increase of sales of properties in the £251,000 to £925,000 band, while 11% of NAEA members saw an increase in sales of properties up to £250,000.
“Reforms to stamp duty was one change that NAEA members predicted would influence the market this year, and from our latest housing market survey it seems that we are starting to see the initial impact of these changes,” said Mark Hayward, managing director of the NAEA.
“December is typically a quieter month for the property market however it would seem prospective home buyers have been left feeling encouraged, while agents have also reported activity in the middle price mark picking up. The changes are obviously in the beginning stages of giving the market the boost it needs, making buying more affordable for many.”
NAEA member agents reported the percentage of sales made by first-time buyers increased by two percentage points, from 24% of total sales in November 2014 to 26% in December. Out of those sales made by first-time buyers in the month, 48% were aged 18 to 30, suggesting a higher proportion of younger first-time buyers had been encouraged onto the market than the previous month, when just 38% of sales were made by first time buyers aged 18 to 30.
However, while there was uplift in the percentage of sales made to first-time buyers and a seasonally high number of eager house hunters on books, the number of houses available for sale on NAEA member agents’ books in December did not follow suit. The number of houses available per NAEA branch was seasonally low at just 45 properties per branch, compared to 50 in November 2014 and 47 the year before in December 2013. The lack of supply, and ultimately lack of choice for prospective buyers, saw NAEA members’ record on average just five sales per branch in December compared to eight the previous month.
Hayward said: “While demand is particularly high at present, owning to the recent changes, the process of putting a house on the market for sale takes a little longer, and so the fact that we have not seen supply immediately increase following the reforms is not really surprising. Typically, a lull in activity is expected for this time of year, so the seasonally high level of demand is unusual in itself.
“This is just the start of the changes to the market – we would hope to see the new reforms eventually balance the see-saw of supply and demand, so it will be interesting to monitor the true impact over the course of the next few months.”
