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Thursday, 24 April 2014

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House statistics remain gloomy - but hope prevails

House sales across the UK are almost 40 per cent lower than they were five years ago according to surveyors – and houses are also taking much longer to shift.

This is the picture of the housing market painted by research from Britain’s property surveyors.

Yet their findings are not all negative – and amidst the gloom they do show optimism for the future.

The Royal Institute of Chartered Surveyors (RICS) compiled figures comparing last month’s activity with the same point five years ago, in May 2007, before the credit crunch and worldwide recession.

This May the average number of completed sales per surveyor was 15.6. The figure in May 2007 was 25.4.

Homes are also taking much longer to sell than they did before the recession. During the three months to May, surveyors sold 23.1 per cent of the homes on their books. In the three months up to May 2007 they sold 40.9 per cent.

Nonetheless most surveyors do expect to see an upturn in transactions over the next three months – though they don’t expect prices to rise far.

“It’s no surprise to see such a sizeable drop since the market peak back in 2007,” says Peter Bolton King, housing spokesman at the RICS. “Ongoing economic instability, in the UK and overseas, has continued to undermine confidence.”

But he adds: “In spite of this, a gradual stability is returning to the market. Surveyors expect transaction levels to increase over the coming months, even if prices continue to dip across most parts of the country.”

Gary Pollard, the joint managing director of Homesearch Direct, agrees that the situation is showing signs of improving, but is starting from a low base.

“We are a lot busier than we were last year – but then no-one was very busy last year,” he explains.

“It’s a buyers’ market, so marrying the prices that sellers want with the prices buyers want to pay is the difficulty.”

Mr Pollard also points out that the current recession differs from previous ones because banks remain so reluctant to lend – particularly to those without a hefty deposit.

“In the past the money was still available. But those 100 per cent mortgages are not available this time and so first-time buyers are thin on the ground. If first-time buyers can’t buy then nobody else is going to move on.”

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