The data from Connells Survey & Valuation also shows that first time buyer valuations were 2% above the annual increase for the overall housing market and 26% greater than the year on year increase for home mover activity.
According to John Bagshaw, corporate services director of Connells Survey & Valuation, many first time buyers may be eager to get on the housing ladder now to avoid any potential rate rise by the Bank of England in the New Year. ‘While any increase to the base rate will likely be slight, it could be enough to persuade cash limited and price sensitive first time buyers to act sooner rather than later,’ he said.
He believes that first time buyers are also looking to take advantage of Government backed schemes such as Help to Buy while they last. ‘Although the Government has given no clear indication these packages will end anytime soon, they could be gradually phased out as housing market confidence continues to improve,’ he explained.
‘These two factors are reinforced by an economy that currently boasts a golden combination of growth, low inflation and rising household incomes, an appealing economic environment for typically cautious first time buyers,’ he added.
The data also shows that the buy to let market experienced similarly strong, if less pronounced, annual growth, with activity in the sector up 26% between November 2014 and November 2015. The strong performance comes despite the market contracting slightly by 4% on a monthly basis.
Valuation activity for all purposes also remains strong, climbing 29% between November 2014 and November 2015, while registering no change compared to last month.
‘The buy to let sector continues to be an attractive proposition for property investors. But while the prospect of high returns is driving some of the activity in this sector, much of the energy is also being fueled by a desire to out manoeuvre the Treasury’s attempts to take more money from buy to let business,’ said Bagshaw.
‘With the Chancellor imposing more fees and regulations on landlords in his most recent Autumn Statement, many would be landlords are hurrying to get into the market before these changes kick in from April next year,’ he explained.
He also pointed out that the housing market’s overall performance remains positive. All sectors are reporting healthy yearly growth and he said this is a reflection of a positive combination of economic growth, rising consumer confidence and improving real terms wages.
The remortgaging market continues to expand rapidly on an annual basis, with the number of remortgaging valuations carried out in November 2015 representing a 46% increase on November of last year, while also representing a 5% increase on October 2015.
However, progress for the home mover market was more gradual. Valuation activity for those seeking to progress further up the ladder grew by 5% between November 2015 and November 2014, while the sector experienced a month-on-month contraction of 8%.
‘The remortgaging sector is rapidly gaining a reputation as the stalwart of the housing market and this month was no exception. Home owners are as keen as ever to take advantage of the low rates to either get a better mortgage deal or release equity on their current property in order to renovate it,’ said Bagshaw.
‘The strong sentiment currently among home owners in favour of improving rather than moving goes some way to explain why fewer property owners have been opting to progress up the property ladder,’ he added.
‘Some may also be finding the festive period a particularly stretched one when it comes to finances and so are choosing to wait until the New Year when their capital flows are steadier. But despite a somewhat quiet month for home movers, it’s been a period of festive cheer for the rest of the housing market,’ he concluded.
