Mortgage valuation activity in the final quarter of 2011 outstripped business a year ago, according to Connells Survey and Valuation.
The firm says that the increase was driven by first-time buyers hoping to beat the end of the stamp duty holiday in March.
Although the total number of valuations the firm conducted during December declined by 14% on a monthly basis, this was a much smaller fall than the average drop of 20% between November and December that has occurred since 2007. During Q4 2011, valuation activity grew by 3% compared to the previous quarter – an increase of 71% compared to Q4 2010.
In fact, throughout the whole of 2011, Connells report 43% more valuations than in the previous year. John Bagshaw, corporate services director of Connells Survey and Valuation, said: “The seasonal Christmas slowdown may have set in during December, but the monthly dip was much smaller than in recent years.
“Better than expected lending figures as banks and building societies hurried to meet full-year targets helped drive the annual increase in valuation activity in the run-up to the new year – a welcome contrast to the situation the previous December, which saw a dismally low level of lending.”
In Q4 2011 there were 9% more valuations for first-time buyers than in the previous quarter – an annual increase of 56%. Similarly, valuation activity for home movers grew by 6% on a quarterly basis, a 61% increase compared to the final quarter of 2010.
Bagshaw said: “We are starting to see first-time buyers with finance act with a greater degree of urgency to move before the end of the stamp duty holiday in March. This should filter up property chains, helping bolster spring activity.”
In 2011 as a whole, Connells Survey and Valuation also reported conducting twice as many valuations for remortgagers than in 2010. Buy-to-let activity also increased annually in Q4 2011, rising by 83% compared to Q4 2010, despite a quarterly fall of 11%. Bagshaw said: “Growing remortgaging and buy-to-let activity were key to the resilience of the mortgage market last year, and this is likely to be the case as 2012 progresses.
“Although the eurozone crisis may impede lenders from drastically growing their loan books, tenant demand and rents will remain strong, enticing new investors to the sector.
”While Connells reports on its valuation activity, the firm does not indicate how many valuations resulted in mortgage agreements.