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Home buyer interest continues to grow

Home buyer interest continues to grow

Category: Mortgages

Updated: 13/12/2011
First Published: 13/12/2011

MONEYFACTS ARCHIVE
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Home buyer activity continued to pick up in November, but uncertainty over the state of the economy continues to hold the market back from any meaningful recovery, according to new research.

In its latest monthly UK Housing Market survey, the Royal Institution of Chartered Surveyors (RICS) said enquiries from potential buyers had increased for the third month in a row for the first time since spring 2010.

At the same time, new instructions from people wanting to put their property on the market also increased to its highest level since April.

The number of house sales completed also crept higher during the month, although RICS said activity remained 'very subdued' on a historical basis.

With demand for properties running pretty much in line with the new supply coming to the market, the survey also suggested that house prices remained broadly unchanged over the month.

Looking ahead, a broadly similar story to that seen in much of 2011 is anticipated for 2012, with prices remaining relatively stable but more on the downside, and sales expectations being broadly positive, albeit low.

When questioned about the factors which they felt were holding back activity in the housing market, most surveyors said uncertainty in the economy was the main reason.

The availability of mortgage finance, or lack of it, was the next most popular answer, followed by the fear that house price falls.

"It is encouraging that buyer interest has edged upwards in the face of the endless diet of negative news from Europe and the turmoil in financial markets," said RICS housing spokesperson, Alan Collett.

"However, a meaningful recovery still seems some way off."

"While the proposed mortgage indemnity scheme is clearly likely to provide some assistance for the market and is to be welcomed, its focus on the new build sector will inevitably mean that it only offers support for a relatively small share of the market."

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