Investors trying to secure new property have seen the numbers of homes available to purchase drop to its lowest level since December 2002, following the latest trend report from the National Association of Estate Agents.
The average number of properties available per estate agent branch in January dropped to 33, the lowest number for almost 14 years when only 25 properties were available.
According to historical Nationwide Building Society data shows 14 years ago the average house price was at £115,940 – about £80,000 lower than today.
Simultaneously, the NAEA registered a soaring demand for houses last month, with an average of 453 property hunters registered for each branch.
This new number defines a 21% increase from December, is the highest increase since last summer and is, at the same time, putting even more upward pressure on prices.
The NAEA explains these developments with the increased activity from landlords rushing to complete sales ahead of the upcoming buy-to-let surcharge coming into play from April.
Seven in ten estate agents have reported an increase of 44% in interest from landlords compared to December, when investors digested the news announced by Chancellor George Osborne in the Autumn Statement.
These findings are revealed after a separate data, published recently by the British Bankers’ Association, registered a surge in mortgage borrowing by 38% in the last year.
The BBA accounted this leap largely to investors looking to beat the imposition of additional stamp duty on buy-to-let properties.
The data also revealed that the number of sales made to first-time buyers went up 5% from December 2015 and covered almost a third of all January sales.
Mark Hayward, managing director of NAEA, said: “Our findings this month reflect what we are all seeing across the market, which is that landlords are trying to complete on sales ahead of the changes to stamp duty on additional homes in April. It continues to be a sellers’ market as demand outstrips supply.”
The number of first-time buyers went up this month, and we should expect to see their market share go up even more after April.
“The fact that housing supply has reached a 14-year low really highlights the need for the government to push the house building programme to the very top of their agenda and help more first-time buyers make their first step on to the housing ladder.”
Some areas of the country have seen property values go up over the last year due to the increasing demand putting upward pressure on prices.
In Reading, Berkshire, house prices increased 16.1% compared to January 2015, data from the Land Registry shows.
The data collected by the Land Registry also revealed there had been a strong rise in monthly values, suggesting an increase in demand. Property prices increased by 2.5% in January, with the strongest value rises being reported in Wales at 3.7%.
Source: Daily Mail