January saw 56% more new buyers than in December, significantly faster than monthly growth in all other areas of the housing market, the report says. On an annual basis this brings the number of valuations on behalf of first time buyers to 35% higher than January 2013.
‘A certain New Year jump is normal but this January has felt more like a stampede. The seasonal rebound between December and January has been significantly stronger than we usually experience,’ said John Bagshaw, corporate services director of Connells Survey & Valuation.
‘One factor is the effect of government schemes. The vast majority of Help to buy loans have been taken out by first time buyers. But alongside this is a wider movement, fuelled by a general surge of confidence and a new willingness by lenders to target new buyers,’ he added.
The report reveals that across all sectors, activity increased strongly in January with total valuations activity up by 37% on a monthly basis, bringing the number of all valuations to levels 33% higher than in January 2013.
It also shows that remortgaging activity saw the second fastest monthly growth, up 31% compared to December. On an annual basis, this leaves remortgaging the fastest growing area of activity, with the number of valuations for remortgaging purposes 56% ahead of January 2013.
Meanwhile buy to let valuations accelerated by 29% since December, leaving buy to let activity in January up 32% on an annual basis.
Bagshaw pointed out that over the course of 2014 mortgage rates are likely to start rising but for many some of the best deals will be found before the end of April when new, tighter regulations come into force in the form of the Mortgage Market Review. As a result, the next couple of months will remain busy for those hoping to catch the best fixed rates on the market.
‘Landlords are among those searching for the best deals, yet this business should remain steadier for some time. First time buyers have come back to the market in dramatic numbers, but demand for rental property is still solid. So combined with steady capital accumulation from price rises the buy to let market looks set for consistent growth for some time,’ he said.
Established home movers saw slower progress than those on the first rung of the ladder. Valuations on behalf of those selling their home grew by 28% between December and January, half the monthly rate of growth for new buyers. Below average monthly expansion leaves valuations activity on behalf of established movers up by just 16% on an annual basis, half the levels of overall annual growth.
‘Home owners looking to upscale are still the exception rather than the rule. Home movers have not made up such a small proportion of all activity since 2008. This situation is likely to remain the case for some time, until salaries start to rise in line with house prices,’ added Bagshaw.
