Buy-to-let activity has plummeted by in the past year, allowing first-time buyers to get on the housing ladder.
According to the latest research from surveyor Connells Survey & Valuation, the number of valuations for first-time buyers rose by a fifth in the year to January (21%), driven by high employment and an uplift in weekly earnings.
This has increased the importance of first-time buyers to the overall housing market, with first-time buyers now responsible for a third of activity (34%), up from a quarter at the start of 2016 (25%).
In contrast, landlord activity has declined by 63% year-on-year.
This is partially due to a surge in buy-to-let purchases in January 2016 as landlords brought forward purchases to avoid the 3% stamp duty surcharge – but landlord investment is still well down on January 2015.
John Bagshaw, corporate services director of Connells Survey & Valuation, said: “Aided by cheap mortgages rates, aspiring home owners have seized the opportunity to get their first foot on the ladder.
“As a proportion of the overall valuations, first-time buyers are now even more important to the health of the market – making up a third of activity. It will be reassuring for the Government to know that their policies to boost demand from first-time buyers are bearing fruit.
“However, more work is still required to ensure the supply side of the housing market is fit for purpose. First-time buyers tend to be younger couples, keen to start families, so need to be able to move up the rungs on the property ladder easily. The policies to ensure the right homes are built in the right places within the new white paper should help boost the supply of family homes, but the Government must also deliver on their pledges to build homes faster to ensure a healthy housing sector over the next few years.”
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