Encouraging signs for the housing market

The National Association of Estate Agents (NAEA) has reported a positive start to the year in their January housing market survey, indicating renewed optimism from consumers. In January, sales to first time buyers rose again for the 4th month running, with them capturing over 14% of gross sales. More importantly for the market as a whole, this is the highest percentage of sales to first time buyers since October 2006. This increase shows that the greater number of first time buyers registering with agents at the close of 2007, are starting to filter through and agree a sale, perhaps buoyed by the recent cuts in interest rates and in some areas, a slight fall in house prices. Agents also reported an increase in the number of properties on their books in January, but while sales have also increased from December, they are still below the figures recorded for January 2007. The report questions whether this is due to sellers not being realistic with the market value of their home, in what is at best a static market. On average, property is taking 21 weeks to sell, but encouragingly once it does sell, most proceed to completion, with the number of sales falling through keeping steady at under 10%. This report is good news for buyers and sellers alike, and is a welcome counter balance to some of the more speculative doom and gloom being reported. While it is still early days it is encouraging that the cuts in interest rates, leading to some cheaper mortgages, and an easing on expenditure, are having a positive effect on consumer confidence.