Last updated 05:13, Friday, 31 October 2008

The housing market is showing early signs of improving with sales rising and first-time buyers resuming their search for a home, estate agents have claimed.

Looking to buy: September showed the first hopeful signs in the housing market since the downturn began in January this year

The average number of sales made by estate agents increased for the first time since January during September, rising from five to six.

At the same time, the proportion of first-time buyers agents had on their books increased from 8.3 per cent to 9.5 per cent, according to the National Association of Estate Agents (NAEA).

There was also a slight jump in the overall number of househunters registered with agents, with this rising from an average of 207 in August to 211 last month, although it remained well down on the 326 people searching for a home in September 2007.

The figures came as the British Bankers’ Association reported a 10 per cent rise in the number of mortgages approved for house purchase during September, while net mortgage lending also increased during the month.

The NAEA said the increase in first-time buyers suggested the Government’s recent announcement that it was suspending stamp duty on properties costing up to £175,000 for a year had helped to restore some confidence in the market.

But it added that conditions continued to be challenging for estate agents, and it continued to urge the Government to introduce a stamp duty holiday for all properties.

The improvement seen during September could also be the result of people delaying moving plans during August while they waited for the stamp duty announcement.

Chris Brown, president of the NAEA, said: “It is clear that certain factors are in motion within the property market, with a decision being made on stamp duty last month, but this is still not enough.

“As property prices continue to drop the Government needs to take action and make some drastic changes to restore confidence.

“It is evident from the results that despite some positive indicators, consumers are still cautious with many continuing to adopt a wait and see attitude and are only moving if it is necessary.”

Despite the slight increase in sales during the month, the number of transactions remained well down on September last year, when estate agents sold an average of 11 properties each.

Homes also took slightly longer to sell during the month, at an average of 14.13 weeks compared with 13.52 weeks in August, although the number of unsold properties agents had on their books remained unchanged at an average of 91.

The NAEA said the figures suggested that while there were still people who were keen to move, many potential buyers were continuing to sit on their hands to see how the market developed during the coming months.

There was also a slight rise in the number of sales that fell through, with these rising to 11.72 per cent of transactions from just over 10 per cent in August, possibly due to people worrying about their job security.