The NAEA stated that despite the almost unprecedented weather conditions in the first couple of weeks of January, Estate Agents, over the course of the month managed to increase the number of sales they agreed, which is a remarkable achievement. The knock-on effect of increasing sales was to further reduce the supply of housing available to buy. This is a trend which, if it continues, will put increased upward pressure onto house prices.

Demand for housing does not appear to have been hit as badly as was feared in the wake of the Government’s decision to end the stamp duty holiday. The number of people registering for new property rose strongly in January. Another encouraging sign of confidence in the market comes from the first time buyer segment who were responsible for almost one in four property sales agreed. This is a reflection that confidence in the housing market is robust and could suggest that lenders are beginning to make mortgages available to responsible borrowers.

In the months ahead we may see a slight increase in house prices caused by restricted supply but this should peter out naturally as the perception of a short-term increase in house prices persuades sellers to come to the market. To conclude, January was a positive start to 2010 and the market has defied many who predicted disaster.

The number of house-hunters registered per branch increased from 251 in December to 291 in January. The larger trend in the property market over the last 12 months has been one of fluctuating but sustained demand compared to the previous year. The degree to which the market strengthened over the course of 2009 is evidenced in a year on year comparison. In January 2009 the average Estate Agent had 242 potential buyers registered.

The number of sales agreed per branch increased from an average of 5 in December to 6 in January. After the traditional festive lull saw a drop in sales in December, it is heartening to see the number of sales made per Agent pick up again in January. While this number may not have been as large as hoped, when the disruption caused by the weather is considered it can be seen as a remarkable achievement.

The average number of properties available for sale per branch decreased slightly from 59 in December to 55 in January. Over the course of 2009 and into 2010 the level of housing stock has fallen consistently. This reflects the fact that higher levels of sales are being made than were in 2008. This trend is largely responsible for recent increases in house prices and will likely encourage that trend. However, in itself the perception of a short term increase in house prices will encourage sellers back to the market, increasing supply.

The percentage of first time buyers increased from 19% in December to 23% in January. In keeping with other positive market indicators in January, the percentage of sales being made to first time buyers increased. Almost one in four sales in January were made to first time buyers. This is a particularly reassuring statistic for Agents, as this market segment was the one many felt would be most vulnerable to the Government’s decision to end the stamp duty holiday at the close of 2009.

President of the NAEA, Gary Smith, said: “Our figures suggest that concerns expressed about the prospects for the market in 2010 may prove unfounded. This appears to be confirmed by the increased level of sales, which given the awful weather conditions is quite amazing. The dwindling housing stock on our members’ books reflected the increase in sales month on month but this is a worrying trend that, if continued, will result in further upward pressure on prices. More encouragingly, the very important first time buyer section of the market now makes up almost one in four purchases. This confirms their confidence in the market as well as their ability to obtain attractive mortgage deals.”

The greater confidence in the property market witnessed towards the end of 2009 continued over the Christmas period into the new year. In the run up to the ’festive season’, Agents were still reporting higher levels of activity than would have been normally expected for the time of the year. Surprisingly this translated into sales in the last week before Christmas and even in the traditional quiet week between Christmas and the new year.

Heavy snow falls at the beginning of the first week in January were not helpful but did not ‘kill the market stone dead’ as one might have expected. After the heaviest overnight fall of snow in our region, I abandoned my car at home and did two market appraisals ‘on foot’ at some distance apart rather than postpone to a later date. Although appearing on the door steps looking as though I had just returned from an Everest expedition, in both cases I received instructions to proceed with the marketing of the homes. Coupled with a house sale the following day it was certainly a positive start to the new year for my office!

Often the Christmas period provides the catalyst for moving home, with families spending more time together and discussing their plans for the future. There are many uncertainties ahead in 2010 that are likely to affect the property market, including the general election, the stamp duty holiday ending and the VAT increase. Let us hope the enthusiasm for moving home continues and in the early months of 2010 there is a flurry of new homes coming on the market and not  more snow!

The number of people searching for property soared by more than 25% in the twelve months to December, according to the National Association of Estate Agents.

The NAEA’s monthly market report found that the average Estate Agent had 251 house-hunters on its books in December 2009, compared with 200 in December 2008.

The number of people looking to buy had fallen from 279 in November, as expected during the traditional festive slowdown in the property market. This slowdown saw the number of sales agreed per branch drop from eight in November to five in December.

The number of properties available for sale per branch increased slightly from 58 in November to 59 in December.

President of the NAEA, Gary Smith said: "December is always a slow month for Estate Agents as house-hunters tend to take a break from their property search.

Given the usual seasonal lull, these figures are very much in line with our expectations but, nevertheless, continue to demonstrate a marked improvement on December 2008.

We are now more interested in how the market will bounce back in January, given that the Government has not responded to our requests to extend the Stamp Duty holiday, which ended in December. Thousands of potential buyers are still in need of help and further, more robust, action is needed to make mortgages more available.”

The National Association of Estate Agents (NAEA) has revealed its predictions for the UK property market over the next 12 months.

Predicting a market hugely dependent on how much lending will be made available, the Association said:

House prices could remain flat, or, in some markets possibly drop slightly, for the first six months, before picking up again and remaining stable in the second half of the year. Supply will remain stable in the run up to the General Election, after which there are likely to be more houses available for sale, particularly if Home Information Packs are scrapped.

The General Election would cause a lull in activity as people adopt a “wait and see” approach.  A number of buyers will continue to take advantage of lower interest rates and lower priced property. The continued presence of First Time Buyers will be critical to market success.

Peter Bolton King, chief executive of the NAEA, said: “While not being a brilliant year, 2009 was for many agents much better than the year before. In 2008 many could not see how they would survive but in 2009 for a lot of agents there was at least enough activity to keep the business going. This was certainly a year of survival of the fittest and those able to offer a first class service.

The beginning of 2010 will see several things happen. The stamp duty holiday will end, despite warnings from much of the property industry that this is a mistake, and this has the potential to reverberate around the market.

We also have an increase in VAT and an imminent General Election. This means that some people will adopt a wait and see attitude to housing as they study what tax changes will mean for them and how the election is likely to play out.

In recent months the market has witnessed a slight increase in housing prices, driven largely by the fact that, in some markets, demand is outstripping supply. If more property comes onto the market the house price rise will flatten or, in some cases might fall slightly over the first six months of the year.

During this year we have however seen a pick up in demand as many take advantage of lower prices and interest rates. This clearly indicates that the British public still believes that investing in bricks and mortar is the right thing to do.

There have been encouraging levels of first time buyers throughout 2009 and I would hope this continues into 2010. Again, the situation with lending will have an impact. The NAEA believes that responsible lending to responsible people is crucial to any recovery.”

Industry heavyweights have added their support to the 1808 Coalition, set up by the National Association of Estate Agents (NAEA) and the Association of Residential Lettings Agents (ARLA) to campaign for the Government to modernise Stamp Duty.

1808 Coalition partners are:

Peter Bolton-King, Chief Executive of the NAEA, said: “The Coalition believes that Stamp Duty is an anachronistic tax which, in its current form, is preventing a recovery in the housing sector – it limits market flexibility, creates regional inequality and its slab structure unfairly distorts the housing market.  With the Pre Budget Report due soon, now is the time for the Government to take action.”

The current Stamp Duty “holiday” for properties lower than £175.000 is due to expire at the start of 2010 but in a recent survey by the NAEA, 91 per cent of estate agents surveyed felt that it should be extended.  86 per cent of those surveyed felt that the tax is unfair.

Ian Potter, Operations Manager of ARLA said: “Not only does Stamp Duty prevent those aspiring to own a home from doing so, it also impacts the whole property chain. For ARLA members, this means having to pay Stamp Duty on the bulk price of a portfolio, when individual buy-to-let investors pay a lower rate on the single unit price.”

Robert Sinclair, Director of the AMI, said: “It is rare that the breadth of our industry comes together with such consensus on an issue.  But the current Stamp Duty regime is distorting the market to such an extent that we feel compelled to speak out.  The Association of Mortgage Intermediaries is fully committed to supporting this industry campaign to reform the regime. We implore the Government to not only listen but, to act in support of our request for change to this damaging tax.”

John Stewart, HBF’s Director of Economic Affairs, said: “It is imperative that the first signs of market stabilisation that have emerged in recent months, and which have allowed home builders to begin tentatively opening new sites and expanding output and employment, are nurtured. The Government’s stimulus measures for housing, including the raised stamp duty threshold, have played a significant part in this stabilisation and it is vital that they are not removed at this still fragile stage, either in total or in part.”

Adrian Coles, Director General, BSA, said: "The current Stamp Duty system in the UK is archaic and in desperate need of reform and modernisation. A fairer and transparent system is needed that doesn't discriminate against young and first time home buyers, and promotes an effective housing market."

Michael Coogan, Director General, CML, said: “We urge the government to announce a comprehensive and long-overdue review of Stamp Duty.  Reform is needed of a tax that distorts the housing market.”

David Salusbury, Chairman, NLA, said: “Stamp Duty Land Tax is a pernicious tax which has failed to keep pace with house price appreciation. It creates an unbalanced housing market and discourages investment in housing. Reform is needed now.”

About The 1808 Coalition

The 1808 coalition campaign to reform Stamp Duty is named after the year Stamp Duty was first extended to property sales in Great Britain. According to The 1808 coalition, the Government should abolish Stamp Duty outright, or implement one of the alternatives:

Suspending Stamp Duty for the duration of the housing downturn, with a commitment to review the existing system

Reforming the system moving from the distorting ‘slab’ system to a more progressive ‘slice’ system or progressive system which, like other taxes, is index-linked to inflation

Raising the starting threshold for this tax well above the current £175,000 limit to ensure that as much is done as possible to assist first time buyers into the market.

October was a relatively strong month and like September revealed a consistent demand for properties.

It seems buyers are keen to take advantage of the Stamp Duty holiday before it ends in the New Year.

Demand is exceeding supply across the UK housing market, with Estate Agents registering five house hunters to every available property. The monthly market survey of the National Association of Estate Agents found that the average branch had 287 house hunters on its books in October, down slightly from 294 the previous month. The supply of properties also fell. This could reflect the fact that increased numbers of buyers are still working their way through the system and have not yet become sellers in their own right.  It can be expected that this situation will correct itself as the market continues to revive.

The average branch had 57 properties on its books in October, down from 62 in September. This demand is pushing house prices up as the gap    between asking and selling prices fell from 10.9% in September to 8.8% in October. However, the increase in demand did not translate into an increase in sales – which dropped from nine in September to eight in October. Even so, a significant percentage of these sales were made by first time buyers (22%) – more than double the number this time last year. It should also be remembered that September sales were at a slightly higher level than had been expected at the end of the summer holiday.

Gary Smith, President of the NAEA, said: “There is strong demand for property and more optimism in the housing market than we have seen for months. This is good news for the recovery of the market and for the UK economy in general. Many buyers are at the very beginning of the house buying process and this is creating a lack of properties in the short term. It is now up to the Government and the banks to do more to keep the  momentum of market recovery going.  A good place to start would be for the Government to extend the Stamp Duty holiday, which mainly affects first time buyers, and is currently scheduled to end in December.

The danger is that this short-sighted policy could precipitate an unwelcome pause in the housing market at the start of the New Year. We can only hope that common sense will prevail and that the Government will raise the lowest level at which Stamp Duty will apply to £175,000 for an indefinite period."

Simon Dunn, Yorkshire Branch PR said: “It is encouraging to hear from NAEA members in the region that the autumn property market has picked up since the schools went back in September. However, there is still a shortage of homes coming onto the market, which is not helpful but sales are ticking over at a reasonable rate. Sales at the asking price, are being achieved on some homes where a realistic price was adopted at the start. Where sellers have been over optimistic with their asking price, and delayed making a reduction to stimulate more interest, when their home is finally sold the price achieved is often at a lower level than would have been possible if appropriate action had been taken sooner.

Mortgage funding from the lending institutions is still proving to be a ‘headache’ with 15% to 20% deposits required from first time buyers to get on the housing ladder. This is a far cry from the ‘good old days’ when 5% to 10% was the norm with less money to find, as prices were lower.

There are mixed views on how the market will go forward over the next few months but it is considered by some in the profession that we are ‘not out of the woods’ yet. The other view is that we are starting to see the beginning of a positive recovery.  A balanced view may be that we are going to see the slow return to a more normal housing market, something that everyone should surely welcome”.