Number of new buyers down in 2007


Tue 14th Aug, 11:54:19 BST

The number of prospective first-time buyers declined at the fastest rate for three years since the start of 2007.

According to the latest report from the Royal Institute of Chartered Surveyors (Rics), the number of inquiries from new buyers fell in July, while the number of properties on the market which went unsold rose.

The organisation has attributed the fall to consumer trepidation concerning interest rates, with many potential buyers preferring to stay within the rental accommodation sector for the time being.

Jeremy Leaf, a spokesman for Rics, said: "The combination of softening demand and supply is causing market conditions to weaken further.

"Buyer activity has pulled back a little over fears that we may have seen the top of the market.

"With interest rates perched at 5.75 per cent and a jump to six per cent a strong possibility, aspiring first-time-buyers are continuing to rent until the market trend becomes clearer."

Earlier this week the Department of Communities and Local Government reported that the annual rate of house prices growth was 12.1 per cent higher in June 2007 than in June 2006.

The average cost of a UK home now stood at £214,222 in June, up from £210,793 in the previous month.



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