The valuations market saw a 32% dip on a monthly basis in April, according to the latest Housing Market Activity Report by Connells Survey & Valuation.
Despite the monthly fall, the overall valuations market remains in stronger health than a year ago, with Connells Survey & Valuation conducting 23% more valuations than in April 2011.
John Bagshaw, corporate services director of Connells Survey & Valuation, says: “After a hectic March by post-2008 standards, a combination of the hangover from the end of the Stamp Duty holiday and the interruption of the Easter holidays took its toll on the housing market in April.
“But the valuations market has not come to a standstill by any means, and is actually stronger than a year ago.
“However for momentum to begin building again in the short-term, it’s crucial lenders don’t withdraw support for high LTV lending in the face of a technical recession and the ongoing eurozone crisis.”
After the rush to beat the end of the Stamp Duty holiday in the first quarter, April saw 28% fewer valuations for first-time buyers than in March. However, despite the monthly change, first-time buyer activity represented a 15% increase compared to the same time last year, and accounted for 31% of all valuations.
The number of valuations for owner-occupiers moving home fell back in April, with 29% fewer than in March. On an annual basis, activity increased by 12%.
While buy-to-let valuation activity recorded a seasonal decline of 32% on a monthly basis, it increased by 68% annually – albeit from a low base. Remortgaging also registered an annual increase, rising by 33% in April.
Bagshaw adds: “Both buy-to-let and remortgaging have been key to the annual improvement in the valuations market. Buy-to-let mortgage rates have remained competitive in recent months, and this has helped boost the demand from landlords looking to take advantage of healthy yields and strong underlying tenant demand.
“News that we are back in recession is likely to kick the prospect of a rate rise in the near future into the long-grass, which will keep payments historically low for many borrowers, giving those on trackers less motivation to shop around.
“However, the trend of increasing variable rates will underpin demand for remortgaging and this sector is likely to see steady growth in coming months.”