In the month of October, there were almost twice as many valuations conducted for homeowners as in the previous October, while in the three months to the end of October, the number of homeowners requesting a valuation on their home rose by 75% compared to the same period in 2008.
Overall, transactions were up 26% in October 2009 compared with the previous year, and up 13% in the three-month period (again compared with 2008).
Ross Bowen, Managing Director for Connells Survey & Valuation said: "This upswing in the number of valuations for homeowners is further evidence of the gradually strengthening housing market. Sellers who have been sitting out the recent economic woes have seen double digit house price rises since the spring, are putting their homes on the market and are moving on. The low level of activity over the past couple of years has created a lot of pent-up demand and people want to move – and established homeowners typically have more equity and are better placed to buy."
The increased activity was not solely restricted to existing homeowners, but the growth of first-time buyer activity was much more muted. Connells data also shows that there were one third more valuations for first-time buyers in October than in the same month last year, while the three-month period saw an upswing of 15%.
Renewed activity for first-time buyers is a positive development but the borrowing environment remains difficult, with tighter income multiple/affordability tests and very limited availability of 90% loan-to-value mortgages.
Despite requiring larger deposits, and thresholds for affordability and credit scoring remaining high, a growing number of first-time buyers are starting to take the plunge, leading to the increase in valuations requested.
Bowen said: "We are seeing more positive sentiment in the housing market, but lending conditions are still proving very challenging particularly for first-time buyers. After recent corrections many people see this as a good window of opportunity to get a foot on the property ladder – and stop paying rent. But often they need to find a deposit of £30,000 which is out of reach for nine out of ten of them.
"Home ownership remains the goal of many people in their twenties and thirties, despite underlying concerns over how unemployment will play out in the economy over the next few years. The sooner we can get more lenders in the 90% LTV space on a consistent basis, without overly punitive criteria, the sooner we will see firmer footings in the housing market."
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