Mortgage valuations up despite large drop in buy-to-let

Demand in the UK housing market is still strong despite the impending EU referendum, according to Connells Survey & Valuation.

Overall, the total number of housing valuations the firm carried out in May was 18% higher than in May 2015, although on a monthly basis valuation activity in May decreased by 1% compared to April.

Remortgaging and first-time buyer sectors continue to be stand-out areas of activity, as the key driver of annual growth in May’s valuation market.

Unsurprisingly given the Stamp Duty rush in the previous months, the buy-to-let sector experienced the sharpest contraction at 38% while remortgagers are leading the market with a 42% increase followed by a 37% boost for first-time buyers.

John Bagshaw, corporate services director of Connells Survey & Valuation, said: “Compared to the gloomy picture painted by some, activity is looking remarkably resilient ahead of June’s housing market.

“Some month-on-month cooling could still be a result of Stamp Duty changes that came into effect at the start of April. However, once that Stamp Duty-related instability has passed, there appears to be a steadier annual growth and a more positive outlook for the housing market.

“Even if the EU referendum does have a measureable impact, one thing is clear – any slump hasn’t happened yet.”

Meanwhile, mortgage brokers Enness Private Clients are expecting activity to pick up after the referendum as it has done following previous national votes.

Islay Robinson, chief executive of Enness Private Clients, said: “Despite falls in enquiry levels and some stagnation in the property market in the lead-up to the EU referendum, we expect things to pick up afterwards, as they have in recent years.

“The month immediately following the 2014 Scottish referendum saw a 60% increase in enquiries and in the months leading up to the 2015 general election enquiries declined gradually, only to increase by 40% as soon as the threat of mansion tax had vanished.

“We expect a similar increase once the EU referendum is behind us.”