House hunters in the UK seem to be holding off making a decision with the country’s general election just a week away, according to the latest monthly report from estate agents.
Some 63% of members of the National Association of Estate Agents (NAEA) believe that demand for homes is at its lowest since last year with just 343 house hunters registered per branch compared with 406 last September when demand was at its highest.
The report also shows that just 22% of total house sales in March were made to first time buyers, the lowest since July 2014 and down 30% from February.
NAEA member agents are concerned about supply and demand for first time buyers as housing policy remains one of the big election issues. The report also shows that almost half, 48%, of agents favoured the Conservatives’ pledge to build 200,000 new starter homes, arguing that this initiative will be the most beneficial for the first time buyer housing market.
However, only 6% back Labour’s promises to boost house building rates to 200,000 a year by 2020 and 31% do not believe that any of the proposed policies will be enough to straighten the market out.
‘We would always expect to see an event as monumental as a general election having an impact on the listing market. But what makes this election so interesting is that no one knows what the result will be,’ said Mark Hayward, NAEA managing director.
‘And with housing featuring so prominently in all three main parties’ manifestos, buyers in particular are holding off to see what will happen. The outcome of the election will impact first, second, third and last time buyers,’ he added.
The NAEA report also shows that while demand is down to 343 house hunters registered per branch in March, supply is up 12% from 43 to 48 houses available per NAEA member branch, as houses stay on the market for longer with nervous buyers.
Demand still hugely outstrips supply, so a fall in demand does not affect the number of sales. March saw an increase in the amount of sales agreed per branch, with 10 sales going through, compared to eight in February.
‘We may have seen a slight increase in supply this month, but it is not an ongoing trend or a big enough jump to fill the gap for demand. It’s encouraging to see all parties actively proposing plans to regulate supply and demand,’ said Hayward.
‘However, the policies in place are unlikely to be enough to rectify the crippling situation we’re in. It’s all very well proposing to build 200,000 houses, but planning law, lack of infrastructure and available labour can make this process so lengthy that it may be ten or twenty years until we see this, by which time demand will be greater,’ he explained.
‘Although our agents have seen the market cooling off ahead of the General Election, it will inevitably bounce back again at a rapid rate after 07 May, so it is more important than ever that the party elected focuses on increasing the supply of homes,’ he added.
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Source: Property News Spain