The National Association of Estate Agents (NAEA) has reported that demand for property is at the lowest level for a year.
The organisation’s March Housing Market Report found that ahead of the General Election, demand is at the lowest since March last year, with just 343 house hunters registered per branch, compared to 366 in February, and 406 in September 2014, when demand was at its highest.
63% of NAEA member estate agents believe house-hunters are holding off to see what the result of the election is.
NAEA member agents are concerned about supply and demand for first-time buyers; 48% of NAEA agents favoured the Conservatives’ pledge to build 200,000 new starter homes, arguing that this initiative will be the most beneficial for the first time buyer housing market. 6%t back Labour’s promises to boost house building rates to 200,000 a year by 2020. However, a third of NAEA member agents (31%) do not believe that any of the proposed policies will be enough to straighten the market out.
Mark Hayward, managing director, National Association of Estate Agents (NAEA) said: “We would always expect to see an event as monumental as a general election having an impact on the property market. But what makes this election so interesting is that no one knows what the result will be. And with housing policies featuring so prominently in all three main parties’ manifestos, buyers in particular are holding off to see what will happen. The outcome of the election will impact first, second, third and last time buyers.”
While demand is down to 343 house hunters registered per branch in March, supply is up 12%, from 43 to 48 houses available per NAEA member branch, as houses stay on the market for longer with nervous buyers, the NAEA said.
Demand is still massively outstripping supply, so a fall in demand does not affect the number of sales. March saw an increase in the amount of sales agreed per branch, with 10 sales going through, compared to eight in February.
Hayward added: “We may have seen a slight increase in supply this month, but it is not an ongoing trend or a big enough jump to fill the gap for demand. It’s encouraging to see all parties actively proposing plans to regulate supply and demand. However, the policies in place are unlikely to be enough to rectify the crippling situation we’re in.
“It’s all very well proposing to build 200,000 houses, but planning law, lack of infrastructure and available labour can make this process so lengthy that it may be ten or twenty years until we see this, by which time demand will be greater. Although our agents have seen the market cooling off ahead of the general election, it will inevitably bounce back again at a rapid rate after May 7th, so it is more important than ever that the party elected focuses on increasing the supply of homes.”
