‘Brexit remains a major drag on the property market’: Prices remain sluggish, buyer enquiries are down and few homes coming up for sale, say estate agents
- Prices look set to remain subdued in the near term, the Rics say
- But, outlook for 12 months time looks better, with prices forecast to rise
By Jane Denton For Thisismoney
Published: 00:02 BST, 11 April 2019 | Updated: 09:09 BST, 11 April 2019
The UK’s housing market looks set to continue to struggle over the next few months amid the political chaos over Brexit, the country’s estate agents warned today.
A closely-watched survey compiled by the Royal Institution of Chartered Surveyors revealed that new inquiries from buyers in every part of the country fell for the eighth consecutive month in March.
A net balance of 24 per cent of those surveyed saw a fall rather than an increase in house prices last month, suggesting that the market is still faltering as buyers worry about taking on new debt.
Embattled: Britain’s housing market looks set to continue to struggle over the next few months, the Rics said
This points to a ‘modest fall’ in house prices at the national level over the next couple of quarters, the Rics said.
At around 42 per branch, the number of homes on estate agents’ books is still at a near record low.
In terms of how long properties are taking to sell, it now takes around 19 weeks from listing to completion, which is the joint longest time period since records on this started in 2017, the Rics said.
The South East of England continues to show the most protracted selling times, at 21-and a-half weeks on average.
Simon Rubinsohn, chief economist at the Rics, said: ‘Brexit remains a major drag on activity in the market with anecdotal evidence pointing to potential buyers being reluctant to commit in the face of the heightened sense of uncertainty.
‘Whether any deal provides the shift in mood music envisaged by many respondents to the survey remains to be seen but as things stand, there is little encouragement to be drawn from key Rics lead indicators.
‘We expect transactions to decline on this basis.’
Taking a dip: Many parts of the UK saw property prices fall last month, according to the Rics
London and the South East of England continue to display the weakest sentiment regarding property price growth, with Scotland and Northern Ireland the only areas of the UK to have seen sustained price growth on a consistent basis over the last two months.
While all this may seem somewhat gloomy, the outlook for the longer term is more upbeat and estate agents expect prices to go up.
A balance of 15 per cent more surveyors anticipate house prices will be higher rather than lower in a year’s time.
Prices are expected to return to growth across most areas over the next year, with Northern Ireland, Scotland and Wales leading the way in terms of expectations.
London and the South East are the only areas where surveyors expect prices to continue falling over the year ahead.
Queries: New potential buyer inquiries fell again last month, the latest Rics survey shows
Brian Murphy, head of lending at the Mortgage Advice Bureau, said: ‘This morning’s report from RICS contains the results of a monthly sentiment based survey of members, rather than being data-led, and therefore provides us with an excellent temperature-check of the current property market across the UK from those at the coalface.
‘Whilst the current political uncertainty still casts a shadow over the near-term expectations of the market, it would appear that many surveyors believe that the twelve-month view will bring an improvement.
‘As is always the case, sentiment fuels markets and therefore once clarity around the UK’s departure from the European Union is reached, a number of RICS members appear to believe that the current market stagnation will ease.
‘Back in the current market, however, according to this months’ report it would appear that landlords are seeing a more positive climate, with average rents increasing across the first quarter of this year, as is to be the expected outcome of fewer currently active investors.
‘Meanwhile, mortgages remain highly competitive as many lenders continue to review their pricing in order to tempt new customers onto their books. This is providing those who are currently purchasing with the opportunity to secure a mortgage at or close to historically low rates, therefore helping to support the market in areas which are more active.’
Selling times: On average, it now takes around 19 weeks from listing to completion to sell a home