Volume of agreed house sales up 10.7% in June

The volume of agreed house sales increased by 10.7% in June, Hometrack’s latest Monthly National Housing Survey shows.

This is the greatest monthly increase since March 2011 and compares to a rise of 1.6% in May and 8.0% in April.

There was also a 1.9% increase in the number of new buyers registering with agents in June, compared to a 0.5% decrease in May.

But the average property price fell by 0.1% in June, following a fall of 0.1% in May and no change in April.

Hometrack says the improvement in sales volumes is largely the result of a bounce back in activity following a subdued May market but it is also a reflection of lower prices and greater realism by sellers over achievable pricing levels.

It adds that the supply of homes for sale continues to grow well ahead of demand although at the same time improved sales volumes are eroding the stock of property for sale.

The report shows the number of properties for sale on agents’ books grew by 3.5% in June following a 3% increase in May.

Hometrack says that looking across the first half of 2011, the housing market is holding up better than many had expected albeit at low transaction levels.

It says average prices may have slipped back by 1% over the first half of the year, but sales volumes have increased as demand has improved and sellers become more realistic about the prices they are able to achieve, although average prices today are 3.9% lower than at the same time last year.

And at a local level the report notes the market remains highly polarised, with the average time on the market ranging from a low of six weeks in London to 14 weeks in Wales.

Richard Donnell, director of research at Hometrack, says: “The second half of the year is set to see subdued demand keeping a further downward pressure on prices. Overall we still expect headline house prices to be down by 2% over 2011.

“While the balance between supply and demand is not significantly out of kilter, subdued demand and weak consumer confidence are set to keep headline prices under modest downward pressure over the months ahead.”