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News: NAEA: Market steady during holiday period

The housing market is holding steady during the holiday period the National Association of Estate Agents said. Survey results for June from the NAEA reveal continued stability in the housing market.

Both sales agreed and houses available are consistent to those reported in May, the estate agents’ body reported somewhat belatedly yesterday. The number of buyers on estate agents books fell slightly, but this does not appear to have any immediate affect on the market.

The number of first time buyers recorded by agents fell, but their share of the market is encouragingly up from the same period last year. The time taken to sell was also increased and the difference between selling price and asking price continued to fall steadily. The survey also revealed a renewed strength in the lettings market.

First time buyers

The first time buyer share of the market slipped back slightly in June after its dramatic increase in May. They took 12.5% of the market in May, and 11.9% share of the market in June. This compares to just 7.8% in June 2005 and 28% five years ago in June 2001.

The stability of interest rates has been successful in bringing the foundation level of the housing market back. However, more needs to be done to encourage this sector of the market back to full strength and successfully underpin the market, said NAEA.

Sales up from same period last year

Sales are up by 25% from June 2005, an average of 15 sales per agent was reported in June in comparison to just 12 one year ago. Sales remained steady in comparison to last month, showing strength and confidence in the market.

Sellers continue to be realistic with asking prices

The gap between asking price and selling price closed further in June, and is now at just 3.1%. This is down from 4.5% recorded in June 2005. It is a positive sign for the wider housing market, indicating that vendors and agents are being realistic with pricing.

Fall through rates increase

Disappointingly, the number of transactions that fell through after a sale had been agreed rose in June to 9.15% from 8.6% in May. This increase is a natural consequence of the greater availability of housing stock seen in May. Over 60% of failed sales are due to either a broken chain or a higher offer from a competing buyer, research conducted for NAEA recently showed.

Serious buyers remain on the books

The number of buyers registered on estate agents books decreased in June, from 378 per agent in May to 367. However with sales and instructions remaining level, it is clear that serious buyers continued to search for their dream homes.

NAEA President, Charles Smailes, commented: "I am delighted to see such a positive overall national picture for the June housing market. The increase in housing stock seen in May has held steady in June, and I hope to see this increase further in the coming months offering greater choice."

"Despite first time buyer percentages decreasing slightly this month, I am pleased that this is still higher than the levels seen during the same period in 2005. It is extremely encouraging to see their continued involvement in the market."

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