First-time buyers gaining confidence in market

More people will be celebrating moving in with champagne as the market picks up
More people will be celebrating moving in with champagne as the market picks up
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THE number of first-time buyers in August 2013 outpaced those recorded in August 2007, according to surveying company.

In total there were 40% more first-time buyers last month than in August 2012 and 1% more than August 2007.

The 2013 data bucked the trend of a typical slowdown in housing activity in August. Over the previous five years there has been an average of 4% fewer new buyer valuations in August than July.

But this August, by contrast, there were 4% more first-time buyer valuations than in July, according to chartered surveyors Connells Survey & Valuation.

Total numbers of all residential valuations conducted in August have grown almost as strongly, up 39% in the last 12 months. Compared to July, August also saw more total activity, with a 1% monthly increase.

John Bagshaw, Corporate Services Director of Connells Survey & Valuation, said: “The UK housing market went into hibernation five years ago, and we’ve had to wait a long time and work through considerable developments to see some significant positive trends emerging since.

“Helped by the Funding for Lending Scheme and Help to Buy, thousands of new buyers are overcoming huge obstacles from wage freezes, inflation and lower saving rates, turning long pent-up dreams to buy into reality.”

Home mover activity also accelerated, with the number of valuations growing almost as fast as those for first-time buyers, up 3% between July and August. On an annual basis, this puts home-mover valuations almost a third (32%) higher than in August 2012.

Mr Bagshaw said: “It is great to see ‘property ladders’ coming back into view. Some households are regaining sufficient confidence and control of their finances as parts of the economy move up a gear.

“Most importantly, renewed availability of credit is turning that optimism into solid reality for householders who have put off a house move for many years.”

Remortgaging activity experienced the largest slowdown in August. However, despite a 4% monthly fall compared to July, the number of remortgaging valuations in August remained 49% higher than a year ago – the fastest annual rate of growth.

Mr Bagshaw added: “Numbers of first-time buyers are flowing again, but it isn’t like the floodgates have been thrown open for everyone.

“There are still thousands of households whose earnings have little chance of matching inflation – let alone being sufficient to support loans based on current house prices.

“The other side of the story to first-time buyers are those still renting, and buy-to-let activity is still growing at an astounding pace to keep up with demand for renting.”