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Demand remains in the housing market

Demand remains in the housing market

Category: Mortgages

Updated: 10/12/2010
First Published: 10/12/2010

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Demand remains in the housing market despite constrained sales levels, the National Association of Estate Agents (NAEA) has insisted. The housing market is going through something of a mid-winter slump at present, as values and activity have fallen.

New figures from the organisation show that sales were stagnant for the fourth month in a row, with NAEA branches making an average of seven sales in the month. However, the NAEA said figures were encouraging as there is usually a seasonal slow down at this time of the year.

There is also evidence that a number of potential new buyers are entering the market. In November, the average number of registered buyers at estate agents increased markedly, from 218 to 241.

"There is still clear evidence of demand for property in the UK housing market. In fact, given the restrictions on mortgage lending and the approach of Christmas, the true level of demand is probably higher than indicated by our figures," Michael Jones, president of the NAEA, said.

"These are not window-shoppers. Our agents are continuing to make sales and it is particularly pleasing to see sales figures remain constant at this time of the year."

Despite an upturn in the number of potential buyers, the number of homes available to buy fell in the month, with an average of 64 homes for sale, compared with 67 in October. The NAEA said that the fall was likely a result of buyers holding off putting their property on the market in the hope that values will increase in the New Year.

Similarly, the percentage of sales being made to first time buyers also fell.

Whereas in October, almost a quarter (23%) of all home buyers were first time buyers, less than one in five (19%) were so last month.

Looking forward, Mr Jones said that prices are likely to remain reasonably stable over the next 12 months, dependent on interest rates remaining low.

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