Halifax reports highest house sales for two years: Rate of business failures gives some cause for optimism

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The Independent Online
HOUSE sales are more buoyant than at any time in the past two years, according to estate agents.

Halifax Property Services, the estate agency arm of Halifax Building Society and one of the largest agency chains in the country, said that it sold more houses in February than in any month during the previous two years although it declined to give figures.

This confirms indications of recovery seen in rising building society mortgage commitments in February. There were also suggestions from estate agents that commercial turnover may be showing an improvement.

Any pick-up in housebuying would stimulate demand in other sectors such as furniture and DIY.

According to Halifax, viewings of properties and inquiries are running at double last autumn's levels. Thirty-four per cent of people in the first-time buyer age group said they were seriously considering buying.

Officials at the National Association of Estate Agents (NAEA) backed up the view on increased sales.

Michael Jones, president of the NAEA, said the market had been boosted by activity among housing associations using pounds 750m of Treasury assistance to buy repossessed properties. He believed most of this money had now been spent but despite this, anecdotal evidence suggested that sales were still strong.

'The market is still quite busy and sales are continuing on a par with February,' said Mr Jones, who runs his own agency, Michael Jones & Co.

'But it is still a bit fragile. It would not take much to tip the balance back if the Government was to reverse the trend on interest rates.'

A wider economic recovery was suggested by Dun & Bradstreet, the business information firm, which said that business failures in the first quarter were only slightly up on a year ago. The firm said the 4 per cent rise was the first indicator of relief for a business sector decimated by the longest post-war recession in the UK.

Bankruptcies of sole traders continued at high rates but the number of liquidations of limited companies fell in the first three months. Larger companies were also settling their invoices faster than a year ago.

From January to March, 14,443 businesses collapsed, of which 5,297 were limited companies. A year earlier, 5,603 limited companies failed. There were wide regional variations over the year, with Wales showing a fall of 17 per cent in business failures.

Fragile consumer confidence and gathering recession in Continental Europe will hold back a recovery this year despite the significant loosening of policy since Black Wednesday, Oxford Economic Forecasting said.

However, the group's latest assessment of Britain's industrial prospects foresees a quickening recovery in 1994. Output is expected to rise by 1.6 per cent in 1993 - against the Treasury's expectation of 1.25 per cent - and accelerate to a 2.7 per cent annual expansion the following year.

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