Agents are hoping for summer rate cut to boost buyer activity

Most estate agents expect a summer interest rate cut to help revitalise buyer market activity but remain split on whether this will drive up house prices, latest survey results from GetAgent.co.uk reveal.

Some 85% of those surveyed believe that its higher mortgage rates that have dampened buyer market activity, with nearly eight out of 10 (79%) stating that the issue has persisted due to the Bank of England’s decision to keep rates held at 5.25%.

LOWEST LEVEL

The latest Gov figures released last week, show that inflation has fallen to its lowest level in almost three years and, at 2.3%, sits close to the Bank of England’s target rate of 2%.

But while a rate cut was widely expected this summer, April’s inflation figure came in higher than expected, denting hopes of a cut in June.

The majority of agents believe a cut is what’s needed to boost buyer interest, with 83% believing that when the base interest rate does come down more buyers will be enticed back to the market.

However, just over half (52%) believe that more buyers will offer a higher percentage of asking price compared to the current market if rates do come down, with just under half (48%) believing that they will continue to offer the same.

DOUBLE TROUBLE

Colby Short, Co-founder and Chief Executive of GetAgent.co.uk, says: “Transactions so far this year have been at their lowest levels since 2013.

“The number of listings has remained quite high but properties have not been selling at the rate they have over recent years.

“This has been a double serving of trouble for agents as they have had to pay to acquire the same number of listings, pay for photos, pay to market the properties but are not generating the same revenue. It’s great to finally see light at the end of the tunnel.

“May’s transaction numbers increased year on year and, with inflation falling, cheaper lending appears to be on the horizon. It can’t come fast enough for the property industry!”