The supply of homes for sale in the UK in March fell to its lowest level for the month, traditionally regarded as the start of the busy spring selling season, since records began in 2002.
The number of prospective buyers also fell in March but there were more sales to first time buyers, according to the latest housing report from the National Association of Estate Agents (NAEA).
Overall, the number of properties available to buy on estate agents’ books decreased to 39 in March from 44 in February, the lowest for 16 years and year on year supply was down by 28% as agents have an average of 54 properties available in March 2016.
The number of house buyers registered per member branch fell in March as well. Estate agents had an average of 397 prospective buyers on their books last month, compared to 425 in February.
The data also shows that in March last year there were 417 prospective buyers registered per branch, meaning demand has fallen by 5% year on year.
The proportion of sales which were agreed for first time buyers increased for 22% in February to 25% in March but this is still well below the 30% sole to first time buyers in January.
The average number of sales agreed decreased in March to 10 per branch from 11 the previous month which had been the highest number recorded since September 2007.
In March, some 5% of properties sold for more than the original asking price. This figure has continued to rise since the low of 12% seen in November 2016.
A year on since the extra 3% stamp duty rate was introduced for additional properties, some 64% of agents said they have seen demand for properties from buy to let investors decrease, while 37% said that they have seen house prices increase as a direct result of the stamp duty reforms.
Mark Hayward, NAEA chief executive, pointed out that there are currently 10 house hunters chasing each available property. ‘With supply at the lowest level for March since records began, building more homes to satisfy demand needs to be a priority,’ he said.
‘In line with this, while sales to first time buyers rose slightly in March, they’re still much lower than the levels seen in the last three months of 2016 which is cause for concern. The upcoming general election is a good opportunity for each Party to outline their plans for tackling the housing crisis. We hope to see it prioritised so we can make the market a better place once and for all,’ he added.