The mortgage market returned to growth in May following the post stamp duty holiday slump.
Activity in the market proved to be sluggish in April, after the stamp duty holiday came to an end on March 24.
Many first-time buyers has rushed through deals before the deadline in a bid to side-step the 1% tax that is usually charged on properties worth between £125,000 and £250,000.
But figures from Connells Survey & Valuation show that the market has bounced back, allaying fears that the end of the initiative could result in a 'prolonged hangover'.
The total number of residential valuations conducted during May rose by 4% compared to April, and were up by 18% on the same month last year.
First-time buyer numbers climbed during the month, following the dip in April.
The number of valuations for first-time buyers represented an 8% month-on-month rise and a 12% increase compared to May 2011.
Improved first-time buyer activity contributed to an increased number of homeowners on the move.
In May, there were 4% more valuations for home movers than in April – representing a 5% increase year-on-year.
"Despite fears of a prolonged hangover after the passing of the stamp duty deadline, the immediate after-effects of the rush are already dissipating, with a steady improvement on April's level of buyer activity," said John Bagshaw of Connells.
"The additional working days in May compared to April helped buoy activity, with improved weather towards the end of the month contributing to improved buyer interest.
"We have seen encouraging signs of underlying demand in spite of the backdrop of a recessive economic climate, the re-imposition of stamp duty for first-timers, and lenders tightening their criteria."
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