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Housing supply plummets to 14-year low

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Demand for property is up but the level of housing supply is woefully inadequate
Housing supply plummets to 14-year low

The supply of available housing has dropped to its lowest level in 14 years, according to figures out today from the National Association of Estate Agents (NAEA).

The number of properties available per branch fell to 33 in January, the lowest recorded since December 2002 when just 25 properties were available per branch.

Supply and demand crisis

Exacerbating the problem is a significant rise in demand between December and January, with landlords in particularly looking to beat the Stamp Duty deadline.

An average 453 house hunters registered per estate agency branch – the highest recorded since July 2015 and a 21% increase from December when there were an average 374 registered, during a seasonal lull in activity.

The increased activity is partly from landlords pushing to complete sales ahead of the upcoming buy-to-let (BTL) surcharge coming into effect on April 1st. Just over seven in 10 estate agents reported an increase in interest from landlords – a rise from 44% in December.

Almost a third (29%) of the total sales made in January were to first-time buyers (FTBs), an increase of five percentage points from December 2015.

Mark Hayward, managing director of National Association of Estate Agents (NAEA), said: “Our findings this month reflect what we are all seeing across the market which is that landlords are trying to complete on sales ahead of the changes to stamp duty on additional homes in April. It continues to be a sellers’ market as demand outstrips supply.

“The number of sales made to FTBs has increased this month, and we should expect to see their market share rise after April. The fact that housing supply has reached a 14-year low really highlights the need for the government to push the house building programme to the very top of their agenda and help more FTBs make their first step on to the housing ladder.”

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