RICS sees increased first-time buyer demand
Share
Demand from first-time buyers is rising, while buy-to-let investors are now gravitating towards houses than flats, research from the Royal Institution of Chartered Surveyors shows.
The RICS’ new buyer enquiries series has reported a positive net balance for 11 consecutive months.
Its August Housing Market Survey focused on the issue of first-time buyers. Surveyors reported that 13% of new enquiries derived from first-time buyers with a net balance of 28% reporting that the number of first-time buyer enquiries had increased over the past three months.
The North West recorded the highest proportion of first-time buyers at 23%, while the lowest proportion was recorded in East Anglia with only 6%.
The results of the survey, meanwhile, suggest that the net balance of surveyors reporting a rise in first-time buyer demand was most rapid in the South East and East Anglia at 56% and 43% respectively. However, surveyors in Yorkshire and Humberside and the North reported falls in first-time buyer demand over the previous three months.
In September, surveyors were asked how buy-to-let demand had changed in relation to both houses and flats. A net balance of two percent more surveyors reported a rise than a fall in buy-to-let enquiries in aggregate; tellingly, interest was generally stronger for houses than flats.
London bucked the trend by reporting a positive balance of 8% more surveyors reporting higher, rather than lower demand for flats compared to a negative balance of 16% for houses - this is arguably a reflection of the different nature of the London rental market and the cost and availability of houses in the capital.
Simon Rubinsohn, chief economist at RICS, says: “House price falls and lower interest rates have gone some way to tempting first time buyers back into the market. However, buyers still need to have greater deposits to access the market with lenders remaining generally cautious.
“This is making it hard to translate this interest into hard transactions. Meanwhile, the firmer tone to the market has also rekindled enquiries from buy to let investors albeit in a more measured way than was visible prior to the onset of the credit crunch.”
