Date Published 17 January 2012
Mortgage valuation activity in the final quarter of 2011 outstripped business a year ago, according to Connells Survey and Valuation.
The firm says that the increase was driven by first-time buyers hoping to beat the end of the stamp duty holiday in March.
Although the total number of valuations the firm conducted during December declined by 14% on a monthly basis, this was a much smaller fall than the average drop of 20% between November and December that has occurred since 2007.
During Q4 2011, valuation activity grew by 3% compared to the previous quarter – an increase of 71% compared to Q4 2010. In fact, throughout the whole of 2011, Connells report 43% more valuations than in the previous year.
John Bagshaw, corporate services director of Connells Survey and Valuation, said: `The seasonal Christmas slowdown may have set in during December, but the monthly dip was much smaller than in recent years.
`Better than expected lending figures as banks and building societies hurried to meet full-year targets helped drive the annual increase in valuation activity in the run-up to the new year – a welcome contrast to the situation the previous December, which saw a dismally low level of lending.`
In Q4 2011 there were 9% more valuations for first-time buyers than in the previous quarter – an annual increase of 56%. Similarly, valuation activity for home movers grew by 6% on a quarterly basis, a 61% increase compared to the final quarter of 2010.
Bagshaw said: `We are starting to see first-time buyers with finance act with a greater degree of urgency to move before the end of the stamp duty holiday in March. This should filter up property chains, helping bolster spring activity.`
In 2011 as a whole, Connells Survey and Valuation also reported conducting twice as many valuations for remortgagers than in 2010.
Buy-to-let activity also increased annually in Q4 2011, rising by 83% compared to Q4 2010, despite a quarterly fall of 11%.
Bagshaw said: `Growing remortgaging and buy-to-let activity were key to the resilience of the mortgage market last year, and this is likely to be the case as 2012 progresses.
`Although the eurozone crisis may impede lenders from drastically growing their loan books, tenant demand and rents will remain strong, enticing new investors to the sector.`
While Connells reports on its valuation activity, the firm does not indicate how many valuations resulted in mortgage agreements.
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