The National Association of Estate Agents November Housing Market report has revealed that the number of sales to first time buyers is falling.
From July through to October the number of sales to first time buyers rose, but in November they dipped by 10%.
Despite plans by George Osborne to encourage and help first time buyers onto the property ladder, more than half of NAEA members believe that this demographic will continue to feel squeezed out of the market thanks to the lack of affordable housing.
Supply-side issues are something the NAEA is seeing at first-hand, with the number of house-hunters rising by 20% as the quantity of available stock fell. The number of house-hunters on average registered per branch grew from 336 in October to 403 in November. The amount of available housing dropped slightly in November, down from 43 to 41. This meant that, towards the end of last year, 10 potential buyers were vying for every available property.
“It’s very normal at this time of year that demand is high and supply is low,” Mark Hayward, Managing Director of the NAEA, commented. “House hunters hoping to find their dream property in the New Year have registered interest with agents, whilst those hoping to sell are holding off putting their properties on the market before January. However, supply is outweighing demand so heavily now that it can’t solely be attributed to seasonality.”
“It’s clear that we’re faced with a crisis here: the housing market needs addressing as a matter of urgency. Our recent Housing 2025 report compiled with the Association of Residential Letting Agents (ARLA) and Centre for Economics and Business Research (Cebr) found that by 2025, house prices are set to rise by 50% - and if we don’t act now, this will impact FTBs, second steppers and last steppers, forcing many out of home ownership.”
Hayward added: “The Government has made efforts to address the issue of supply and demand, with Osborne outlining plans to build 200,000 new starter homes in his Autumn Statement, but four fifths of our agents think it simply isn’t enough. It’s all very well planning to build houses, but we need to move to action and get and the bricks and mortar on the ground, if we’re to solve the crisis we’re faced with.”