Interesting new data was released earlier this week by Countrywide plc concerning the state of the housing market. The estate agent’s quarterly housing review for the first quarter of 2014 reveals that the number of buyers chasing each property has hit its highest level since 2008.
The ratio of buyers to sellers increased by 25% in Q1 2014, according to the review, up from 9.7 buyers to each new seller in Q4 2013, to 12.3 buyers to each new seller in Q1 2014. Consumer sentiment driven by a recovering economy, Government support and increasing mortgage availability is stimulating new and existing demand but Countrywide still expects the number of transactions in 2014 to be less that 75% of the long run average.
January 2014 saw the highest level of demand with 13 buyers chasing each new property coming on the market. In London, the figure was much higher with 25 buyers for every new property - an increase from an average of 11 as recently as July 2013. However, towards the end of the first quarter in March, there were signs that demand eased off slightly as the market slowed to draw breath, but a shortage of stock in many areas remains, especially in London where the number of properties on the market has fallen 20% year-on-year.
Countrywide believes that house price increases are yet to tempt sellers to the market in significant numbers. Equally, it says, competition for property in the Capital makes the construction of longer chains difficult and it is harder for people to move home. Sellers who receive multiple offers for their property are therefore more likely to accept one from a first time or cash buyer because of the shorter chain they provide.
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