Countrywide figures showed that sellers continued to return to the market in March, with a 4.2% rise in the number of new properties for sale – the third consecutive monthly increase.
Nevertheless, despite the sharp rise between Q4 and Q1, new instructions in the first quarter were 5% down year-on-year.
Countrywide revealed that sales dipped 0.8% over the month and were 6% down on March 2010.
However, agents reported a rush in buyers looking to complete on properties over £1m before the rise in Stamp Duty took effect on 6 April, with sales in London and the South East up 41% compared to February.
While overall applications rose in March, they were 16% down on March 2010. Remortgage applications dropped 2% in March, to make up 26% of all mortgage applications for the month.
In addition, new buyer applications dropped 6% in March compared to the previous month – 11% down on the level of applications seen for the same period of 2010.
Fixed rates continued to prove dominant, accounting for the whole of Countrywide’s top ten most popular deals. In Q1, 87% of mortgage applications were for fixed rate products – a 26% increase year-on-year.
Meanwhile, the private rental sector remained buoyant, with new tenant registrations remaining high. While new tenant applications dropped 1% drop in March, they were 1.4% up year-on-year.
Grenville Turner, chief executive of Countrywide, said: “The UK housing sector has experienced a challenging start to the year, but the surge in high value sales has helped the first quarter to come in line with our expectations, with those vendors with realistic expectations being able to achieve sales.”
He added: “Last week’s surprise fall in inflation may have bought some respite for customers and increase the pressure on the Bank of England to hold off from raising interest rates in the next few months.
“The market remains sensitive and will continue to face challenges in the next quarter as the speed and level of growth in the housing sector is likely to continue to be impacted by the overall outlook for the UK economy.”
