First-time buyer numbers down 3.4%

The number of first-time buyers in the UK property market fell markedly last month.

While this group accounted for 11.7 per cent of all property purchases in February, this had fallen 3.4 per cent to just 8.3 per cent in March.

This is the lowest figure reported since 7.9 per cent was noted in April 2006, and is down from 12.6 per cent in the same period last year.

According to the National Association of Estate Agents (NAEA), the drop reflects the current air of apprehension that is hovering over consumers, with a squeeze on mortgage numbers and loan-to-value amounts taking a toll.

Figures released today by the British Bankers' Association show mortgage approvals for the market as a whole (BBA) stand at the lowest rate since 1997.

However, there were some green shoots of hope for the wider industry.

The NAEA finds the number of buyers looking for property has remained broadly stable over the last month, with 249 house buyers on estate agents' books in March compared to 243 noted in February 2008.

However, this figure is down on the same time last year when 385 house hunters were reported on agents' book in March 2007.

Stock levels were also stable in March, with 76 properties for sale in per agent, compared with 74 per agent in February this year and 62 March 2007.

"The global credit crunch, squeeze on mortgage approvals and the media cloud that currently surrounds the property market are undoubtedly having effect on individual's decisions to buy or sell," said NAEA president, Stewart Lilly.

"There is a constant need to remind people that the underlying factors that hold-up the property market - low unemployment, historically-low interest rates and a pent-up demand for houses - still exist.

"In fact, a number of NAEA agents from across the United Kingdom are still reporting stable property markets with many of their branches making steady sales."

Yet, in a final worrying note, the number of sales per agent has fallen. While seven sales per agent were reported in March, this is down from eight in February and 14 in March a year ago.

It also now takes 22 weeks for the average property to conclude a sale – up from 20 weeks in February, and 15 weeks in March 2007.

Chris O'Toole