UK housing market is boosted by first time buyers
A surge in first time buyer activity has created a healthy growth in the UK housing market in March.
First time buyer activity in March increased by 15% compared to March 2015 and 41% compared to February 2016.
The total number of valuations carried out rose 8% year on year and grew by 21% month on month in March.
This was mainly due to the first time buyer sector posting strong monthly and annual growth figures, which in turn could be as a result of the many government initiatives to help first time buyers get on to the property ladder.
While re-mortgagers and home movers also experienced a significant boost in valuation activity in March, there was a dip in overall buy to let activity.
Total re-mortgaging volumes were up 25% month on month and up 33% year on year.
Figures show that stamp duty changes which became effective on 1st April have impacted the buy to let market as valuation activity in this sector has dropped by 27% between February and March 2016.
“The buy to let market has endured a turbulent month but we expect this to be a short term tumble, with investors adopting the standard kneejerk reaction to legislative changes by proceeding cautiously. This is particularly true for a tax increase like the stamp duty shake-up,” explained John Bagshaw of Connells Survey & Valuation.
“Many aspiring buy to let landlords may have realised that if they initiated a buy to let mortgage application in March, they would be unable to get it processed in time to beat the April deadline. Instead, they may be taking their time in order to factor the changes into their financial planning,” he added.
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