NATIONAL ASSOCIATION OF ESTATE AGENTS HOUSING MARKET REPORT
Source: NAEA, May 2009
KEY FINDINGS
- Number of house hunters registered with estate agents increased from 265 in April to 299 in May
- Number of sales agreed per agent remained high for second consecutive month with ten in May
- Average number of properties available for sale decreased from 76 in April to 69 in May
- Number of first time buyers (FTBs) increased to 43% in May - a significant increase on last month's 23%
- The average selling price across all house types in May was 6.3% lower then the actual asking price
CONCLUSIONS
The National Association of Estate Agents Housing Market Survey for May 2009 revealed real good news about the housing market.
The number of people registered to buy property continued to rise, demonstrating that there is real demand for property. At the same time, the number of sales per agent remained high at 10. The percentage of First Time Buyers soared this month, up to 43%, which is a very welcome sign and further indicates that this group of buyers has returned to the market in force.
The number of properties available to sell remains low. However, the vast majority of buyers have a house to sell and will therefore become sellers as the process moves along, eliminating the short term shortfall in available property.
NUMBER OF HOUSE HUNTERS
The number of house hunters registered with estate agents increased from 265 in April to 299 in May
More people registered to look for property in May than at any time over the previous 12 months, confirming that activity in the market has increased. At each stage previously this year an increase in registered house hunters has resulted in an increase in sales per agent. This is a major positive sign the market has seen in 2009.
SALES PER AGENT
The average number of sales agreed per agent, at ten, equalled the increased levels seen in the previous month.
This is a very positive sign for the industry. It provides evidence that the increase in activity has been sustained and that agents are successfully finding properties for buyers.
HOUSING STOCK
The average number of properties available for sale decreased from 76 in April to 69 in May
Housing stock remained low with, on average, four prospective purchasers for every property. Most of these purchasers will have a property to sell in due course so it can be expected that this situation will correct itself as the market continues to revive. The NAEA also believes that Home Information Packs are a significant disincentive to sellers considering a move and continues to call on the Government to take action to abolish the packs to help reinforce the market up-turn.
FIRST TIME BUYERS (FTBs)
The number of first time buyers (FTBs) increased to 43% in May- a significant increase on last month’s 23%
First Time Buyers continued to return to the market, making up more than 40 per cent of new sales reported by agents. This could reflect a surge of people feeling that the time is right now to make an investment in property, prior to a bounce in house prices. One of the strongest indicators in the market in 2009 is the fact that the return of first time buyers has been sustained thus far.
AVERAGE HOUSE ASKING AND SELLING PRICES
May 2009
Property type |
Asking price |
Selling price |
Difference |
% Diff in May |
% Diff in April |
Flat |
£152,861 |
£143,835 |
-£9,026 |
5.9% |
-6.4% |
Terraced |
£189,350 |
£177,404 |
-£11,946 |
6.3% |
-5.4% |
Semi-detached |
£216,878 |
£202,847 |
-£14,031 |
6.4% |
-6.6% |
Detached |
£326,196 |
£303,642 |
-£22,554 |
6.9% |
-6.4% |
6.3% |
-6.4% |
REGIONAL SUMMARIES FROM BRANCH CHAIRMEN AND OFFICIALS
Wendy Evans-Scott- Surrey Branch
I am pleased to report much higher levels of activity. There is a good demand from eager buyers keen to sink their money back into property and out of low-interest savings accounts.
Unfortunately there is still a lack of supply as many sellers are apprehensive about the market and worried about finding a property to move onto themselves.
However it’s still a fantastic time to “trade up” providing a buyer has a good deposit and can secure finance.
There is also a glut of property available for rent which has driven rental values down. A number of areas are seeing a reduction in the number of tenants looking for new properties, as many tenants are staying put and renewing their leases – often at re-negotiated, lower rents – and to avoid the cost of moving.
As property prices look to have “bottomed out” and some reports are show a slight increase in property prices; renting is not the attractive option it once was so would-be tenants will try to buy if at all possible, rather than rent.
Geoff Graham- Durham branch
Discussions with fellow members show a continuing pattern of inconsistency where it appears barely one day is the same as the next. Whilst there are definite signs of improvement we are still experiencing an erratic market in the North East and it is very price sensitive.
Buyers are there but in many cases reluctant to part with their cash and sellers in many cases are not prepared to come down to the level of many offers.
The numbers of transactions are certainly up on this time last year and are continuing to improve month on month.
Ian Harris- Norfolk branch
In my own branch we have had a sale go from instruction to completion in four weeks which in today’s market is quite an achievement. Can this be beaten I ask?
The market in Norfolk is following continuing improvement with sustained interest from cash and first time buyers. However sellers should be careful as ambitious prices will still see otherwise saleable property remaining “stuck”. We look forward to increasing sale levels in this important early-summer trading period.
Andy Rogers- Hereford & Worcester Branch
May was one of the best months we have seen in the market for the past 18 months with increased footfall, enquiries and deals being done across a spectrum of prices in and out of the city. Hopefully this movement will keep the property market going through the summer and sustain prices, although we don't expect to see a rise in prices during 2009.
Trevor Kent- Berkshire, Buckinghamshire and Oxfordshire branch
There is little doubt that business has taken a turn for the better in May in all levels and areas of our market. Those reported green shoots edging nervously out of the tundra really have begun to blossom, and whilst there is no wall-to-wall carpet of colour yet, there are certainly discernable patches of brightness.
What BB&O agents in both sales and rentals pray for now is a plethora of long hot balmy days to encourage purchasers and tenants to come out bee-like and taste the sweet nectar of our property offerings. I am just beginning to get a feeling that there may just be honey for tea again - soon.
Martin Patterson- Scottish branch
The Scottish market has had a reasonable May, perhaps the strongest so far, but many members are still deeply concerned about the months ahead. The intermittent nature of demand pours cold water of any realistic sign of market growth. There is also a feeling that values are slipping as surveyors become ever more cautious with home report survey values. This is a worrying trend and I can only hope that common sense prevails.
Ultimately the ebb and flow of supply and demand should create a steady market, but with demand down, mainly due to lack of decent mortgage products, the supply becomes over stocked and we end up where we are.
I had always hoped that we would see fresh funds inflating the market place by the beginning of the third quarter, I am sorry to say that we are still some months away from providing any positive report on this issue.
Stuart Clark- Suffolk branch
Some of us are busy, some are exceptionally busy. Throughout the area the market continues to improve, most are finding the market the best since 2007. The market for property in the right location; competitively priced and in good condition is doing very well. Some asking prices and above are being achieved, I have even heard of gazumpers re-appearing.
The problems we are facing come down to a shortage of new instructions.
Mark Bentley- Birmingham branch
May turned out to be a reasonable month – in many ways a repeat of April which is a good sign that the property market has steadied, price falls have stopped and confidence is slowly returning.
We have particularly noticed the increase in enquires in the mid price ranges- £200,000 to £400,000. This market has been in limbo over the last 12/18 months as owners have been unable to sell due to the lack of first time buyers and investment buyers buying at the bottom of the market.
Sales level are still only 50% of where they were two years ago but that is an improvement on the 75% fall in sales levels we have seen in the second half of last year.
Hopefully June will see a further improvement in the level of sales across the Greater Birmingham area and the West Midlands in general.
Sonia Millar- Northern Ireland branch
The bottom end of the market, along with the very top end, is showing movement in relation to sales agreed. Perhaps owners have become more reasonable in their sale price?
Michael Hack - Bournemouth & Dorset branch
May has shown an increase in good applicants, who all want a bargain, yet fewer properties have come on the market. Purchasers are still making low offers and expect vendors to accept which more often then not they decline.
There has been no sign of price increases or gazumping as reported elsewhere and solicitors still seem in no hurry to push deals through quickly.
Our area has a very varied cross section of properties and this opinion could be different in other locations.
