NAEA 2014: More New Homes Or Prices Will Rise Unsustainably

First time buyers are unlikely to constitute more than 25 per cent of purchasers in 2014 while the market strengthens but remains hampered by a shortage of supply, according to the National Association of Estate Agents.

“Owning a home is still out of reach for manyas wages struggle to keep pace with prices. More needs to be done to make moving more manageable, in particular the outdated stamp duty system and reducing upfront costs for first-time buyers who still only make up less than a quarter of all buyers and are likely to remain in the minority in 2014” says NAEA managing director Mark Hayward.
“We also anticipate the supply of homes could tighten in 2014, especially larger family homes which tend to be neglected by new build developments. We are seeing more, and more serious, house hunters return to the market so properties are being snapped up quickly. According to our market data, supply is still well down on recent years” he claims.

“In 2013, 50 properties were available on average per member branch, versus more like 60 last year. In 2008 we were typically seeing figures in the high 90s. We need supply to keep pace with demand in 2014 or prices could escalate unchecked. The prospect of sooner than expected interest rate rises should act as a natural brake, but we need this new optimism in the market to be matched by new homes” he continues.

The almost-total absence of data and vague nature of the predictions contrast with many estate agents and business consultancies, and highlight one of the problems besetting the NAEA - that it is not widely respected within some parts of the property industry.

Contrast that with, say, the US equivalent - the National Association of Realtors - which has authoritative research staff, exhaustive data archives, and is a big player not only within the US real estate industry but is also a major player in wider economic forums.

If you would like to to comment on this article, click HERE to e-mail Graham. Follow PropertyJourn on Twitter