First time buyers (FTBs) appear to be returning to the housing market in significant numbers, providing further evidence that now is the right time to invest in property.
The National Association of Estate Agents' (NAEA) Housing Marketing Report for May 2009 shows that the number of first time buyers almost doubled in the month – rising from 23 per cent in April to 43 per cent.
The body said that the return of FTBs to the market was one of the strongest indicators that a bounce in house prices could well be round the corner.
Sales agreed by estate agents remained high, with the average number of deals remaining at ten for the second consecutive month. In May 2008, estate agents were completing an average of less than seven deals a month, while the current number of sales agreed is double the number recorded in August last year.
The number of house hunters registered with estate agents increased from 265 in April to 299 in May, adding weight to the recent trend of increasing buyer enthusiasm and buyer confidence in the market.
Demand is outstripping supply across the UK, however, as the number of properties available at estate agents decreased from 76 in April to 69 in May. In fact, there are now approximately four house hunters for every property.
"This is really good news for the housing market and the UK economy in general," said Gary Smith, president of the NAEA.
"NAEA members are showing that there are buyers aplenty out there. More often than not these are potential sellers who are at the beginning of the process, so there is bound to be a lag which creates a shortage of properties in the short term.
"With mortgage interest rates at historically low levels and prices now far more realistic than in previous years, home ownership in the UK seems to be set to lead the way out of the recession."
The average selling price across all house types in May was 6.3 per cent lower than the actual asking price.
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