Rate rise ahead boosts homebuyer activity
Haart’s 200 nationwide branches found the prospect of rising interest rates pushed up demand in July by 4.1% compared to last year and 5.3% in the last month alone.
In London the supply issue is more acute with 20 buyers chasing each property for sale while the level of competition has pushed up UK house prices which are up 6.4% annually to £217,072 on average.
Paul Smith, chief executive of haart, said: “We saw a surge in activity when Bank of England governor Mark Carney announced that an interest rate rise was on the cards as people looked to take advantage of some of the lowest mortgage rates on record and fix at this level before they increased.
“Now the economic landscape has changed following the market slowdown in China we expect greater calm on the demand side, but true balance will not be achieved until more homes start to come onto the market.
“Registrations in the UK are up 5.3% in the last month alone. However, supply has not kept apace; although we have seen instructions rise by 1.4% in July, supply has actually fallen by 15% annually and in London supply is down by a fifth compared to last year.
“Urgent action is needed to tackle the shortage of stock and allow people to move. A form of land relief to boost building activity is one way to do this.
“The new All-Party Parliamentary Group for Housing and Planning needs to proactively drive national action and make decisions which may not be universally popular in order to tackle the current crisis. If not, we will still be in the same situation come the next election.”