Record UK house buyers in December 2014

on Jan 30, 2015
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Figures released by the National Association of Estate Agents (NAEA) have revealed that the number of house buyers registered at their branches in December 2014 is at a level not seen since 2004.

According to the NAEA, the average of 360 registered house buyers per branch may be linked to the announcement of major changes in the way stamp duty is to be calculated in the future, prompting an increase in those looking to buy towards the end of the year.
Commenting on the figures, NAEA managing director Mark Hayward said: ‘Reforms to stamp duty was one change that NAEA members predicted would influence the market this year, and from our latest housing market survey it seems that we are starting to see the initial impact of these changes,’

In addition to the increase in registered home buyers, the NAEA noted that there had been a slight increase in the percentage of sales involving first time buyers in December, at 26 percent, as compared with November’s 24 percent.
Though the recorded sales activity was encouraging, the NAEA cautioned against excessive optimism, since questions as to the degree to which supply would meet demand arose from their figures. ’ Hayward pointed out that

“While demand is particularly high at present, owing to the recent changes, the process of putting a house on the market for sale takes a little longer, and so the fact that we have not seen supply immediately increase following the reforms is not really surprising.”
Although such procedural delays are identified as a contributor to the supply-side imbalance, perhaps the question of supply is set to become a much broader issue this year, particularly as regards first-time buyers.
Most first-time buyers need access to affordable housing in order to get on the property ladder and to meet current and anticipated UK demand for new homes, some 250,000 new builds per year are needed, a target that hasn’t been met for a number of years.
By way of illustration, the highest number of houses constructed in recent years was in 2006/7, when 216,000 new homes were built. This was 34,000 fewer than the minimum requirement according to official government estimates at that time.
More recently, in 2012/13 only 135,000 new homes were built, which is the fewest in a year since the Second World War. With government targets at 200,000 homes yearly between 2014 and 2018 and with demand for new housing stock already at critical levels, it is likely that lack of supply will this year begin to put significant pressure on first-time buyers. That scenario presents as quite a promising opportunity for property investors looking to capitalise on high rental income in the medium term

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