Housing demand hits 11-year peak

The number of house hunters has hit its highest level in 11 years while supply levels are continuing to fall.

Sales to first-time buyers have also dropped, as more young people struggle to get on the housing ladder.

The June housing market report from the National Association of Estate Agents (NAEA) found the number of house hunters registered per branch was at its highest since August 2004.

There were 439 house hunters registered on average per NAEA member branch in June, up 15% on May when 383 were registered.

This is the highest since August 2004 when 582 were recorded.

Housing supply fell marginally to just 44 houses per branch, against 46 in May, widening the gap between supply and demand.

Mark Hayward, NAEA managing director, said the housing market was coming back to life "in full force" after the lull over the General Election period.

"Buyers are feeling more confident and those who put their plans on hold have kicked off their hunt, causing this massive jump in demand.

“There’s also an impetus to buy right now in light of the impending interest rate rise as buyers fight to buy and fix mortgage rates.

“But the fact that demand is at an 11-year high without the housing stock to fuel it, is bad news for the market.”

NAEA figures showed the number of sales made to first-time buyers declined in June, with the group accounting for just 24% of sales, compared to 29% in May.

Hayward added: “Although activity is still slow, it’s very promising to see that the surge in demand and dip in supply hasn’t caused activity to halt, and houses are still being sold.

“However, the growing gap between supply and demand is worrying and clearly demonstrates that more needs to be done to plug this.

“The election was full of promises to build more houses, but now those promises need to be put into bricks and mortar to respond to demand.”