Is the Property Market Slowing?
The demand for new homes, while still high, appears to be slowing, according to the latest UK Residential Markey Survey from RICS.
The survey, released yesterday, revealed that 14 per cent of correspondents reported an increase in new buyer enquiries throughout June, down from 43 per cent in April.
“What’s more, this easing in momentum,” wrote RICS in its report, “is visible across virtually all regions/countries of the UK covered by the survey.”
The report continues: “Nevertheless, the latest feedback continues to signal a clear excess of demand over supply. Indeed, the net balance for new instructions came in at -34 per cent (down from -24 per cent previously) during June, consistent not only with a third consecutive monthly fall in new listings but also pointing to an accelerated rate of decline. While a net balance of +17 per cent of survey participants still note that the number of market appraisals being undertaken is running ahead of the comparable period last year, this gauge has turned slightly softer in each of the past two months (net balance was +34 per cent in April, +24 per cent in May).”
Some, such as Tomer Aboody, director of MT Finance, said that house prices will continue to rise in the near future. He added: “With a dearth of properties on the market, and demand at its highest level in a long while, quality properties are selling quickly and at increased values. A reduction in instructions will help continue this upwards trend as multiple buyers fight it out for their dream home and can access cheap mortgage rates.”
Others were more critical. Sarah Coles, personal finance analyst at Hargreaves Lansdown, said: “Panic buyers have been clearing the shelves at the estate agents again. The number of new properties for sale fell for the third month running, so although buyers have come to the market more slowly, there are still plenty of them to ensure any promising new property is snapped up overnight. It means buyers are getting sucked into a race to make an offer, then a bidding war, and even after they secure a property, they run a bigger risk of being gazumped.”
She added: “It’s a vicious circle, because potential sellers can’t see anything they want to buy at the moment, so they don’t list. It means anyone who might have wanted to buy their home doesn’t have anything to buy so they don’t list either, and so on.”
The UK housing market appears to be slowing as the Stamp Duty Holiday draws to an end. Yesterday, Property Wire reported that the average house price, according to Halifax, had fallen for the first time in months.