This year should see a recovery, estate agents predict

The number of sales to first timers has risen for the second month running to more than 17%, according to the July Housing Market Survey from the National Association of Estate Agents.

This contrasts with recent surveys from Halifax and Nationwide which said the number of first-time buyers was at a record low.

The latest survey said the number of properties for sale and the number of new buyer enquiries have now returned to levels seen in last year's boom period.

But while the number of sales is above the all-time low of 14% back in May of this year, it remains below the 2002 average of about 25%.

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The association said the recent improvement was "evidence that first time buyer confidence is returning and that sustained recovery in the housing market will be seen during the coming months".

With interest rates remaining at record lows, the rest of the year should see a steady improvement in both house prices and the number of sales, association president Melfyn Williams predicted.

Other signs of a revival, according to the association, were:

• Annual house price inflation, at 8.5%, is broadly the same as last month (8.6%).

  This is further evidence that the sharply declining trend in house price inflation seen since the beginning of the year is over, it said.

• The average number of viewings per sale is down - 15.7 this month against 27.4 last month.

• The size of discounts achieved off the asking price has also reduced to an average 3.4%, against 5.4% last month.

It now takes an average of seven weeks from the time a property is put on the market to agree a sale, and a further nine weeks between agreeing a sale and exchanging contracts, the association said.

Estate agents from around the country gave the association snapshot overviews of their areas.

Record lows

Colin Girling of Colin Girling & Co in Ipswich, Suffolk, said: "[There is an] average supply of property coming on to market and first-time buyers are having problems."

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Mike Skelton of Promark, in Bridlington, East Yorkshire, said: "It would appear that the demise of the housing market as reported in certain national newspapers has been premature.

"The market continues growing strongly in this area."

Last week Halifax said the number of first-time buyers was now at its lowest level since records began in 1974.

Numbers had fallen to 174,000 in the first six months of this year, down more than 30% from the corresponding period of last year, it said.

This was causing house price growth gradually to slow, it added.

The latest report from the Nationwide building society also said the number of first-time buyers was at a 20-year low.

But both institutions also said the gradual slowing in annual house price growth would not turn into a crash.