Countrywide reports marginal improvements in the housing market

Countrywide

Monday, March 14, 2011

There were some modest signs of improvement in the residential housing sector, with buyer, tenant and mortgage applications increasing in February; according to Countrywide, the UK's largest Property Services Group.

Property viewings - one of the leading indicators of buyer appetite - increased by 40 percent in February [1] across Countrywide's network of 1,300 estate agency and lettings offices. The number of sales agreed also rose 47 percent [2] in February; however, overall sales volumes were 4 percent lower than the same period last year [3].

Despite a marginal increase in the number of properties available to rent in February, lack of supply remains an area of concern. As tenant demand in the private rental sector jumped by 11 percent [4], with over 19,000 new tenants registering for rental accommodation in February

Countrywide operates the UK's largest mortgage broker and the activities of its 650 mortgage consultants have revealed a 40 percent increase in mortgage applications during February. Fixed rate mortgages dominated Countrywide's Top 10 Most Popular Mortgages [5] with 9 out of 10 products being fixed rates. Overall, fixed rate mortgage applications reached their highest level since July 2009, making up 88 percent of all mortgage applications in February, a 4 percent increase on the previous month [6]. 

Grenville Turner, Chief Executive of Countrywide, the UK's largest property services Group, said;

"We are beginning to see some early signs of improvement in the property market, whether this can be sustained against a backcloth of challenging economic conditions is difficult to determine.

"The reintroduction of competitive mortgage products is the key to turn the increase in buyer activity we've seen into house sales. Gathering a deposit remains a big hurdle for many would-be buyers. With four of the most popular mortgages applied for in February requiring a 10 percent deposit, this shows that the level of demand for these types of mortgages and highlights the issue of affordability. With more mortgages available requiring only a 10 percent deposit there are positive signs of increased lender appetite.

"Ongoing economic pressures and the upward trajectory of inflation will increase pressure on the Bank of England to raise interest rates at some stage, which is why we're seeing an ever-increasing number of people applying for fixed rate products to give themselves the certainty of mortgage payments for between 2 and 5 years."

Market Insight - February 2011
NB: As the UK's largest property services Group, Countrywide compares its monthly and year on year performance figures to provide a unique UK property market insight

Mortgages:(based on the activities of the UK's largest mortgage broker with approximately 650 mortgage consultants)

Estate agency:(based on the activities of the UK's largest estate agency & lettings network, operating 1,300 offices)

Residential Lettings:(based on the activities of the UK's largest estate agency & lettings network, operating 1,300 offices)

[1] Countrywide: Number of viewings conducted - February 2011 vs January 2011
[2] Countrywide: Percentage increase in the number of sales agreed  - February 2011 compared to January 2011
[3] Countywide: Percentage increase in the number of sales agreed - February 2011 vs February 2010
[4] Countrywide: New tenant registrations - February 2011 vs January 2011
[5] Countrywide: The Top 10 Most Popular Mortgages applied for in February
[6] Countrywide: Number of fixed mortgage applications - February 2011 vs January 2011

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