The latest survey from the National Association of Estate Agents (NAEA) has revealed a quiet September for the housing market as the number of sales agreed and buyers on books were both down for the time of year, while stock levels were reported to be at a high.
After a slight pick up between July and August, NAEA members from around the country reported reduced activity this September. Higher than usual stock levels for one and two bedroom properties have yet to be matched with enough keen buyers and this is causing problems for some regional markets. At the other end of the scale, after a bout of new instructions prior to the second stage launch of home information packs (HIPs) in September, there is now a shortage of new three and four bedroom properties coming onto the market and this is again causing problems.
A number of factors have combined recently to affect the market over what is traditionally a busier time for estate agency. Interest rate rises, the international 'credit crunch' and election indecision have all been cited alongside HIPs as contributors to the current lull.
Although a number of areas have been affected, agents report that London and the South East still remain more active. With the current excess of smaller properties on the market, there is potentially good news for first time buyers as well, who stand to gain from the increased supply over the coming months.
The number of properties on agents' books remained on a level in September at 80 properties per agent compared with 81 in August. This is considerably up on figures seen at the same time last year when agents had on average 61 available properties on their books, and is in fact one of the highest figures recorded by the NAEA survey since 2002. The September 10th launch of HIPs is likely to be one contributor to this as homeowners rushed to enter the market to avoid paying for a Pack. Following this date, sellers of larger properties have been hanging back. Feedback revealed an undersupply of new three or more bedroom properties, while the number of one and two bedroom homes on the market has increased.
First time buyers reduced their share of the market in September for the second month running, down to 8.8% compared with 9.7% in August and 11.1% in September 2006. The good news for first time buyers is that with the current oversupply of one and two bedroom properties there is more choice at the lower end of the market, which can potentially be taken advantage of over the coming months.
NAEA president, Stewart Lilly, comments: "The survey this month has been characterised by extremes, from unusually high stock levels to unusually low buyer levels. The market has certainly been considerably quieter than one might expect moving into Autumn. When you consider the major events that it has had to withstand recently, from the 'credit crunch' to the home information pack launch, this is not so surprising. We all need to be prepared for a more difficult sales environment over the coming months. There are certainly no signs of a market crash, as is being suggested by some, however. In this competitive market, homeowners are strongly advised to heed the advice given to them by their estate agent on matters such as valuation and property presentation. This will greatly increase chances of a successful sale."
