The post-election period has triggered a flurry of interest in buy to let but a sharp decline in business from first time buyers according to Connells’ Survey & Valuation division.
It says there were 33 per cent more buy-to-let valuations conducted in May than at the same time last year. Conversely, valuations for first time buyers declined by four per cent over the same period.
“The picture painted here is a consistent one. Fewer people looking to buy their first home means more tenants sticking to the rental sector. As such, new landlords enter the market and those already in the sector grow their business to capitalise on the increased demand. Yet what remains unclear is how long this contrast in fortunes will continue” according to John Bagshaw, Corporate Services Director of Connells Survey & Valuation.
May’s remortgaging figures also outperformed the overall housing market, with these valuations up nine per cent on April’s figures. This equates to a 31 per cent increase on the number of remortgaging valuations since May 2014.
Meanwhile, valuations for those existing home-owners looking not to remortgage but to move to a new property posted a four per cent increase since April. This has contributed to an eight per cent increase in the number of home-owner valuations since May 2014.
Across all sections of the housing market, overall valuation activity for all purposes has grown by three per cent on a monthly basis, between April and May. On an annual basis, 13 per cent more valuations were carried out than in May 2014.
“The post-election lifting of the threat of state-imposed rent caps and tenancy controls has led to an activity surge from the buy-to-let market. But aside from landlords, people seem more inclined to stick with the status quo for now. A sustained but minimal up-tick in real-terms wages benefits those looking to remortgage – but not necessarily movers” says Bagshaw.
“Racing up the property ladder – upgrading to ever pricier, larger, smarter and better situated homes – is no longer the priority it was pre-crash” he says.