Demand for homes falling, finds survey

DEMAND for homes fell at the fastest rate for nearly two years last month as buyer confidence dipped, industry figures showed.

The number of new buyers registering with agents fell by 4.3 per cent in November, according to the monthly national housing survey from property website Hometrack.

The monthly fall was the fifth in a row and the biggest since January 2009, the survey of more than 5,100 agents and surveyors showed.

Hometrack said the figures meant the normal seasonal slowdown in the housing market in the run-up to Christmas had kicked in a month earlier than usual.

It said near-term prices would remain under pressure and were likely to fall two per cent by the end of 2011.

Hometrack’s research director Richard Donnell said economic concerns amid recent spending cuts, together with expectations of a period of retrenchment in house prices, were driving the weakness.

“It is inevitable this trend will continue as we move into the New Year,” he said.
The group said prices had come under greatest pressure in southern England, where they recovered most strongly in 2009 and earlier this year, while prices did not firm up as much in the Midlands and north.

The number of properties for sale fell by 0.4 per cent in November, the first time in nine months that the survey had shown a fall in supply.

“A continued reduction in the supply of homes for sale seems inevitable in the coming months as vendors either reduce asking prices or withdraw property from the market,” the group said. “We expect this to act as a support to pricing in the second part of 2011.”