National Association of Estate Agents members recorded an increase in housing supply over last month, with the number of houses for sale per branch being 15 per cent higher than the monthly average for the rest of this year.
The October housing market survey found that member agents reported an average of 53 properties for sale per branch, compared to an average of 51 per cent properties recorded per branch in September.
Simultaneously, the number of house hunters fell compared to last month, creating a better balance between available housing and demand, the NAEA stated.
The number of house hunters registered per NAEA member branch fell from 406 in September to 380 in October.
The average number of homes sold during the month remained static on September figures, at an average of nine sales per member branch.
However, the number of first time buyers fell, decreasing 6 per cent in October to 24 per cent of total sales, from 30 per cent of total sales in September.
Mark Hayward, managing director at the NAEA, said the report showed there is a better balance emerging between the level of demand and supply, while the average number of available properties registered per branch rose to accommodate those looking to buy.
“However, both supply and demand is still seasonably low for October. The decrease in buyer demand and in particular the decline in first time buyers, along with a relatively static sales market, could be a direct result of the stricter lending criteria which came into play six months ago at the end of April this year, making it harder for house hunters to access mortgage finance.”
NAEA member branches said that they believed the Mortgage Market Review had particularly affected demand among first time buyers, with 70 per cent of member branches reporting the implementation of the MMR has led to a decrease in the number of first time buyers since it began.
Mr Hayward added: “First time buyers will be especially more cautious about making a purchase due to the stricter lending criteria now in place, which makes it harder to secure finance.
“In addition, prospective interest rate rises earmarked for 2015 present another factor that will most likely affect demand further, and could particularly discourage first time buyers.”