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February 2009

NAEA — slivers of better news amid the gloom

ESTATE agents across the UK reported a slight increase in activity at the end of 2008, according to the National Association of Estate Agents.

After 12 months of misery, the NAEA's monthly market survey for December – traditionally a quiet month – revealed some positive signs in the market.

The number of house hunters registered with agents rose from 186 in November to 200 in December, while the number of properties available for sale on the average agent’s books increased from 87 to 100 over the same time period.

While many agents had expected a fall in activity in December, the number of sales per agent held at six – still a very low figure historically – while the number of first-time buyers as a percentage of new sales rose for the fifth month in a row.

Agents surveyed also reported an incremental increase in house prices.

NAEA president Chris Brown said: “After 12 months of misery, it is heartening to see that some agents across the country performed better than expected at the tail end of 2008. However, nobody should be under any illusion that the housing market’s difficulties have finished.

“Rather, these figures should be taken as hopefully suggesting that the market is, in some areas, beginning to bottom out. This process in itself will be a long one, and any recovery will require help from Government to succeed – most immediately in the form of a complete suspension of stamp duty.

“The reported increase in house prices can be seen as a statistical outlier that hopefully signals the direction in which, with small steps, 2009 will take us.

“However, agents in many parts of the country are still struggling to survive and thousands of potential homeowners are still in need of help from the Government and a commitment from the major lenders to free up credit.”

n Meanwhile, the NAEA has called for the Government to co-ordinate an ‘over-arching recovery plan’ to boost the economy after the Financial Services Authority revealed that repossessions increased by 92 per cent in the third quarter of 2008.

“Worryingly, these figures appear to show that the six month delay on repossession orders that many of the banks announced at the end of last year was not taken soon enough,” said NAEA chief executive Peter Bolton King.

“It is also an urgent reminder that the measures taken by the Government to release credit into the market must begin to take swift effect.

“Most importantly, it demonstrates the vicious cycle of recession – in which unemployment leads to missed mortgage payments and repossessions, which in turn discourages banks from lending and, ultimately, stops potential buyers getting onto the property ladder in the first place.

“The Government and the banks must abandon scattergun rescue packages and co-ordinate on an overarching recovery plan to pull us out of this morass as quickly as possible.”