Buy-to-let valuation activity has declined 63% year-on-year, according to forecasts by Connells Survey & Valuation.
The proportion of valuation activity undertaken in the buy-to-let sector fell from 17% in January 2016 to 7% in January 2017.
Other areas saw an increase with first-time buyer valuations thought to be up 21% and activity for those selling property increasing 10%.
This meant the proportion of first-time buyer valuations rose from 25% in January 2016 to 34% in January 2017 and those selling property made up 26%, up from 21% in January 2016.
John Bagshaw, corporate services director of Connells Survey & Valuation, said: “With UK employment close to its 11-year high and weekly earnings rising by 3%, many first-time buyers are fitter financially than they were a year ago.
“Aided by cheap mortgages rates, aspiring home owners have seized the opportunity to get their first foot on the ladder.
“The demand for homes has been particularly high in January, with the Connells Group estate agency network for instance seeing nearly 12 applicants per each new instruction that comes on to the market.”
Addressing the issue of buy-to-let and dwindling activity, Bagshaw said: “The new White Paper’s aim of helping tenants through supporting the build to rent sector could be rendered ineffective with this recent drop in investment from private landlords.
“While a potential increase in build to rent homes will take some years to filter through, the slowdown in buy-to-let purchases will soon start to bite, with fewer rental properties coming on to the lettings market. This shortage of supply could fuel competition from tenants with the potential to push up rents.
“There is a serious risk that the Government’s attempt to increase the number of affordable homes to rent will also be overshadowed by the impact of George Osborne’s taxation policies aimed at private landlords.
“As the Government’s definition of ‘affordable’ is linked to the market averages, rather than tenant incomes, rising rents could mean new ‘affordable homes’ are out of reach for those just about managing.”
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