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Posted on October 27th 2015 by admin-movingin

Shortage of properties getting worse says NAEA, as mortgage approvals fall

The number of mortgages approved by the big British banks in September fell to its lowest since May.

The fall is attributed to the shortage of homes on the market.

The NAEA also reported on a worsening shortage, saying that in September there was an average of 37 properties per branch.

This was a drop from 38 in August and from 55 in July.

According to the NAEA, the number of applicants also dropped, from 407 per branch in August to 342 in September. However, the organisation emphasised that this was not a cause for cheer.

NAEA managing director Mark Hayward said: “If we could just get supply and demand to meet in the middle, the housing market would be functional again; it’s a real issue across the market at the moment.”

He called the situation “completely unsustainable”.

The NAEA did say that sales to first-time buyers have improved. In September, it said that the average estate agency branch sold nine properties, of which three went to first-timers.

The British Bankers’ Association said mortgage approvals for house purchase fell to 44,489 in September, down from 46,567 in August.

This was the lowest since May and below forecasts of around 47,400 for September – although up 14% on the same month a year ago.

Overall mortgage approvals were 24% up on September last year, stoked by a 40% rise in the number of remortgage approvals.

Separately, forecasters at the Centre for Economics and Business Research also blamed the shortage of properties on the market for revising upwards their price forecasts.

It says house prices this year will rise 5.6% (up from 4.7% in its original forecast). The CEBR is forecasting 3.5% house price inflation next year, with further annual rises of some 4% in the following four years.

The CEBR says that in 2020, the average house price will be £321,600 – or 22% more than now.