Housing market remains stagnant, warn surveyors

Apr 14, 2017, 10:38
Housing market remains stagnant, warn surveyors

The number of new buyer enquiries rose at the strongest rate in six months, while newly-agreed sales rose at the fastest rate in four months.

Northern Ireland house hunters came out in force in March, according to the latest market survey.

"On a UK-wide basis, new buyer enquiries [a good indicator of demand] were flat for a third successive month", RICS said. Consequently, respondents to the survey have reduced predictions for sales growth in the year ahead.

A scarcity of properties coming up for sale means that estate agents are being left with an average of just 43 unsold homes on their books.

All in all, RICS' findings suggest that house prices in the United Kingdom should continue to rise, with housing becoming even more unaffordable than its current levels, something made clear by Samuel Tombs of Pantheon Macroeconomics in a note circulated on Thursday morning.

This has hit sales activity, with transaction volumes failing to rise across the United Kingdom in the last four surveys.

'For the time being it is hard to see any major impetus for change in the market, something also being reflected in the flat trend in transaction levels'.

In the lettings market, tenant demand continued to rise.

While price rises in London have eased down amid affordability concerns and efforts to make high-end properties less attractive to foreign buyers, the North West, South East, Midlands and Eastern England are driving the national rate of growth. Despite this, a balance of 14% more surveyors in London expect prices there to be higher, rather than lower in 12 months' time. Sales expectations have weakened since February, when a balance of 37% of surveyors expected to see a pick-up in 12 months' time.

Simon Rubinsohn, chief economist at Rics, said: "The latest results for the Rics survey show little change in the underlying picture surrounding both sales and markets". "The wider residential market continues to be underpinned by a lack of stock".

Richard Sexton, director at e.surv, added: "It's frustrating to see that the market dipped slightly last month". "The imbalance between supply and demand continues to drive rents upwards".

But the trade association says prices are accelerating in some parts of the United Kingdom due to a shortage of housing.

He said that falling prices in London tended to represent the prime market, rather than the capital as a whole.