Home buyer confidence returns to pre-referendum levels

Confidence among home buyers has returned to levels last seen prior to the EU vote with demand increasing by 16% in September compared with the previous month, according from the latest market analysis.

According to the research conducted by National Association of Estate Agents (NAEA), the volume of house hunters registered per member branch rose from 287 in August to 333 last month.

This is a rise of 16% and takes the number of prospective house buyers recorded up to the levels seen back in June, when estate agents recorded 330 on average per branch and comes as the supply of homes coming on to the market starts to fall, albeit marginally, according to the NAEA.

But while demand continues to improve across much of post-Brexit Britain, the findings from the study found that sales to first-time buyers are falling.

In September, first-time buyers accounted for 23% of sales, down 5% from August and the lowest level seen since November last year when 21% of sales were made to this group of purchasers.

Some 12% of estate agents have seen sales to first-time buyers stall since the Brexit vote, whereas 41% have witnessed no change in first-time buyer activity as a consequence of the Brexit vote.

The volume of homes for sales dropped slightly in September, to 40 per branch, down from 41 properties per branch the preceding month, which was the highest level recorded since March this year while the number of sales agreed were up 12.5% to an average of nine per branch.

But while housing supply has dropped marginally, this does not concern estate agents, according to Mark Hayward, managing director at the NAEA, who points out that it remain higher than the levels recorded between April and July.

“This month’s report proves that buyer confidence is growing, which is obviously reassuring, given that we expected uncertainty following Brexit,” he said.

However, Hayward is worried that the volume of sales being made to first-time buyers has fallen to the lowest number in 10 months.

He continued: “The fact the government’s Help to Buy housing scheme is due to close this year might pose more of a challenge for those who were relying on this to help get their foot on the property ladder.

“We now look ahead to the Autumn Statement and look forward to seeing what plans the government puts in place to assist first-time buyers towards their goal of homeownership.”