The latest report by the Highland Solicitors Property Centre shows continuing growth in the number of enquiries being handled by the centre.
During May, HSPC received a record number of enquiries through its website – up 46% on the same period last year. However, this unprecedented level of interest is not yet being converted into sales.
Reflecting the position throughout the country, financial uncertainty and tight mortgage supply are continuing to holding back this pent-up demand.
Figures just released by the Bank of England show that the number of loans granted in April was the lowest for four months at 45,166 – well behind the 70,000 that experts reckon would be needed to sustain a recovery in house sales. It is first time buyers who continue to face the greatest problems in accessing finance.
With potential buyers either reluctant, or unable, to make a buying decision the resulting weak demand is putting downward pressure on house prices.
The HSPC figures show that the average house price in the three months to the end of May was £162,417 – down 5% on the figure for the same period in 2010.
Total sales have also been squeezed and, for the same three-month period, sales were were down 25% compared to 2010.
However, as with any situation where supply exceeds demand, some properties are still selling. With interest running at such a high level, potential buyers who are in a position to commit, are eager to purchase.
The current record levels of enquiries at the HSPC also bodes well for the future. As financial confidence returns and the mortgage supply eases, HSPC expects to see this pent-up demand being translated into sales.
Meanwhile, those who are in a position to buy, have a record selection of properties in the Highlands to choose from. This is a classic buyer’s market and, during May, the number of properties on the HSPC register had increased by a third compared with 2010.