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Supply demand imbalance to remain, say agents

The majority of agents do not see the supply and demand of homes levelling out over the next five years, according to the National Association of Estate Agents (NAEA).

Three quarters of those surveyed by the Association said they envisage a continuation of the current supply demand imbalance, meaning more buyers will be squeezed out of the market. 

The NAEA’s Housing Market Report for April also found that the general election didn’t diminish demand among buyers as an average of 344 house hunters registered per NAEA member branch, compared to 343 recorded in March. 


Housing supply, however, did decrease from an average of 48 available properties per member branch in March to 43 in April.  

The NAEA also calculates that a quarter of sales in April were made to first-time buyers. 

Despite this, 93% of agents surveyed said they do not see first-time buyers having substantial cut through in the market between now and 2020. 

“Whilst this month’s figures are positive and a step in the right direction, I’d like to think that with the help of 200,000 new starter homes and the Help to Buy ISA, FTBs will be given even more help to get their foot on the ladder; however these things may take time to come to fruition,” says Mark Hayward, NAEA managing director.

Yesterday, the government confirmed that the Help to Buy equity loan scheme has been extended to 2020. 

The chancellor said that the government has committed £6 billion of funding to the initiative which applies to new build properties priced up to £600,000.

“Help to Buy has stimulated demand for new homes and led to a sharp rise in private housebuilding. Extending the scheme to 2020 provides certainty of demand that allows home builders to recruit the people and invest in the land and supply chains required to support further sustained increases,” said Stewart Baseley, executive chairman of the House Builders Federation. 

Since its launch two years ago, a total of 47,018 properties have been purchased under the Help to Buy equity loan scheme, according to government figures. 

  • Jon  Tarrey

    Yep, and it's only to get worse. Good luck to any young person trying to get on the housing ladder in the next five years, you're gonna find it mighty difficult even with gimmicky schemes like Help to Buy and Right to Buy in place.

  • Tim Gorgulu

    No, it won't level out anytime soon. The government need to deal with this long-standing issue, but given their record in the last five years I don't see that happening somehow.

    While I agree with you about RTB, Jon, I think Help to Buy has actually been a success. We've had clients who have benefited from it. It's not without its flaws, but in the main it's done what it said it would.

  • Karl Knipe

    Nothing very surprising here. We all know there is a supply/demand issues and has been for some time. I can't see that changing in the next five or so years, even with the government's planned building of 200,000 new starter homes and various other pledges.

    While demand hugely outstripping supply might sound like good news for estate agents - in that sellers can achieve higher asking prices because they can play hardball with buyers - it can be a double-edged sword. If too many people are put off buying then a seller is going to find it more difficult to sell. That's not we want.

    Plus, high house prices and low stock means more people are forced into the PRS, placing greater pressure there.

    Things aren't perfect, but they have been getting better since it was confirmed a stable government would be in place. Hopefully now, with a small majority, they can really deal with the housing shortage. I don't think we can keep burying our heads in the sands.

    I agree with Tim that Help to Buy has done pretty well. No flawless by any means, but not the disaster some like to make out.

  • Fake Agent

    Will the government build enough new houses to correct the supply/demand imbalance? No, no they definitely won't. They've failed dismally in the last five years, they'll do the same in the next.

    The government don't give a fig about housing as long as house prices stay high and they can give their rich oligarch mates a few nice little sweeteners and tax breaks. That's where London's heading, a home for the rich and the super-rich alone. Back to Dickensian times - with the uber-rich living alongside the crushingly poor. Fun. Fun. Fun.

    It's a similar situation here in Bristol, although nowhere near the level of London. People are finding it more and more unaffordable to buy a house so are giving up on it entirely. This is not a good thing for the industry. Something needs to be done to bridge the gap between supply and demand, but I seriously doubt that will happen.

  • Algarve  Investor

    It's only going to get worse before it gets better.

  • Kelly Evans

    This issue is nowhere near as bad as it's being made out to be. As usual, blown out of proportion by those with vested interests. Ridiculous.

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    • 05 June 2015 14:47 PM

    Another decrease in the supply of properties. Let's hope that the introduction of 200,000 new starter homes will help ease this problem. That and the continued success of Help to Buy. We have to ensure that we give first-time buyers a fighting chance to get on the property ladder.


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