The latest monthly survey of the housing market from the National Association of Estate Agents (NAEA) has found that 91 per cent of respondents reported an increase in the number of viewings from the previous month.
The survey found that the number of applicant enquiries and the volume of sales agreed is now higher than the average for the last quarter of 2001. And despite worries over rising prices the percentage of first-time buyers entering the market remained steady arounf 26.5 per cent.
Hugh Dunsmore-Hardy, chief executive of the NAEA, said: "The market has kicked off the New Year on a positive note.
"While December saw a lull in viewings, the number of enquiries was unusually high and this is now being evidenced in the reported increases in viewings and sales agreed.
"Despite a 66 per cent rise in the number of new instructions, it appears that supply is generally not keeping up with demand, although there are some notable regional variations.
"The fall in the length of time between instruction and sale agreed may be further evidence that properties are being snapped up quickly - although there is a reported two month lapse before exchange of contracts."
The results appeared to show that the buy-to-let market has experienced a strong start to the year, with 81 per cent of agents reporting strong demand for rental properties in their area. However, Dunsmore-Hardy warned that the figures were covering quite significant local and regional variations.
Dunsmore-Hardy said: "While the buy-to-let market is generally healthy, the results of our survey reinforce the fact that investors should be looking further afield for suitable rental properties to buy."