The average number of properties available for sale per estate agent branch was up by 11% in July compared to the previous month, the greatest percentage increase in almost three years, according to the National Association of Estate Agents (NAEA).
The trade body’s July Housing Market Report shows that the average number of properties available for sale per branch increased from 46 properties last month to 51 in July, the highest number of available properties since November 2013.
At the same time, competition among house buyers could be easing. The average number of house hunters registered per branch shrank from 371 in June to 368 in July, and has been declining month-on-month since April 2014. However, the number of registered house hunters still remains significantly higher than the same time last year (July 2013), when only 250 house hunters per branch were counted.
Meanwhile, 66% of homes in July were sold for less than the asking price, a sharp contrast to May when only 46% of properties sold for less than the asking price. Furthermore, only 4% of homes were sold above the asking price in July, compared to 19% in May.
The increase in housing supply and the steady decline in the number of registered house hunters could be a direct result of high stamp duty rates faced by many potential buyers. Almost 90% of NAEA members said that stamp duty either frequently (36%) or occasionally (50%) deterred house buyers from moving. 92% of members believe the government should reform stamp duty land tax.
Mark Hayward, NAEA managing director, said: “The lack of housing supply has been a significant issue over the last few months, so the sign of increasing stock is positive for the market and house buyers in search of their ideal home.
“Another positive for house hunters are the recent reports suggesting house prices are on the decline; our NAEA report has found similar, with a significant amount of homes being sold at less than the asking price. This not only signals an appetite for movement in the market, but is also positive news for current house buyers, especially when faced with the prospect of potentially having to pay higher rates of stamp duty for higher priced houses.”
The number of first time buyers in July remains static, accounting for 20% of sales as recorded in June. However, despite decreasing house hunters and a stagnant First Time Buyers’ market, sales were unaffected, remaining consistent from the previous month with an average of nine sales per branch in July.
