The need for government initiatives to boost housebuilding urgently has been highlighted this month by the National Association of Estate Agents who revealed that UK housing demand has reached an 11 year high, writes Richard Carr.
Thankfully, the increase in house hunters has coincided with a rise in available housing. The average estate agent branch in August had 462 house hunters registered which is a 5% rise on the 439 during July. The previous high was back in August 2004, when numbers reached 582.
However, the number of available properties per National Association of Estate Agents branch rose by 25% from 44 to 55 between July and August. The rise is very nearly a two year high, with this level last seen back in September 2013 when on average 57 homes were available.
Getting over the line
Despite the increased interest and stock, getting over the line and completing house purchases still seems a long, slow and drawn out process. The number of sales completed in NAEA branches remained static between May and June at just 9%. Property specialist Richard Carr believes that the system of completing a house could be improved, which would result in more transactions.
Arguably the most worrying statistic from the NAEA report is that the number of sales being made to first time buyers fell again in July. In May the group accounted for 29%, June 24% and 23% in July, however this is still an increase on this time last year when 20% of sales were made by first time buyers.
Richard Carr believes that as the government’s initiatives to make getting on the property ladder easier such as the ‘Help to Buy ISA’ kick into action, then the amount of first time buyers accounting for sales will increase.
Not enough homes
NAEA Managing Director Mark Hayward told www.propertywire.com that despite the statistics he was worried about the lack of housing.
“Having said that, the fact that there is more housing coming on to the market means that hopefully over the next few months we’ll see activity in the market increasing and more sales completing, to respond to the growing army of house hunters we’ve seen emerging over the last few months,” he pointed out.
“The truth of the matter is though, there simply aren’t enough houses to meet growing demand, and until we see more physical bricks and mortar, there may be no hope in solving the housing crisis,” he explained.
“It’s also alarming that the number of sales being made to first time buyers is steadily falling; with reports of house prices increasing and expectations of rising in the future, first time buyers will continue to be pushed out of the market,” he added.