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Housing demand soars

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A report from property analytics business Hometrack has shown that buyer interest within the housing market grew in February 2012.

Hometrack have released data that shows there was an 18% increase for February in the amount of buyers registering with agents. This was the strongest level of demand since the start of the downturn in February 2007.

It is assumed the increase in potential buyers is due to the stamp duty holiday ending in March. Purchases under £125,000 will not have to pay the stamp duty cost. For those that will have to pay, it will be charged at increasing rates which start at 1%. Currently first-time buyers don’t pay stamp duty on purchases of properties worth £250,000 or less.

The areas which saw an increase in the number of potential buyers was reported in the South East with a 28% increase and the South West with 22%.

The data also showed that even though there was an increase in the amount of people registering with agents the house prices remained unchanged for the second month running. It also indicated that there is a lack of supply of houses which gives the building industry the opportunity to build more houses.

The report stated: “The balance between supply and demand leads underlying house price changes by 3 months. The improved balance over the first half of 2011 led an improvement in the underlying rate of growth.”

Richard Donnell, Director of Research at Hometrack, said: “This is the strongest level of demand seen since the start of the downturn and higher than the 15% increase in potential buyers recorded in February 2009.

“Activity amongst first-time buyers looking to beat the stamp duty holiday - which ends on March 24 - has provided an additional and artificial boost to the figures.”

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By Amanda Bainbridge