Snowy weather in the UK slows real estate market, report says

Although residential property prices increased in January new instructions and buyer interest fell as bad weather hit activity in the market, according to the latest monthly survey from the Royal Institution of Chartered Surveyors published today (Tuesday February 09).
 
In January 32% more chartered surveyors reported a rise than a fall in house prices, up from 30% in December. However, the net balance of surveyors reported that buyer enquiries fell for the first time in 14 months while new instructions dropped for the first time in seven months, the report shows.
   
Some 20% more chartered surveyors reported a fall than a rise in new buyer enquiries, down from a positive reading of 18% while a net balance of 5% of surveyors saw a decline in new instructions which compares with a positive balance of 15% in December.
 
‘The bad weather clearly had a negative effect upon business with newly agreed sales also falling for the first time in ten months,’ the report says. However, surveyors are optimistic that these negative signs are a reflection of the extreme weather conditions experienced in the early part of the month.
 
The number of surveyors expecting house prices to rise increased from 12% to 24%, while the number of surveyors expecting sales to pick up over the next three months rose from 7% to 24% in January.
 
Transaction levels fell slightly in January. The number of sales per surveying firm fell from 19 to 18 while the closely watched sales to stock ratio, a measure of market slack and a lead indicator of future prices, fell for the second successive month.
 
‘The cold snap in January clearly has a huge impact upon both supply and demand in the housing market with activity coming to a halt amidst the seasonal chaos. Activity and interest is likely to pick up in the coming months as the market experiences a spring bounce,’ said Ian Perry.
 
‘House prices are likely to rise in the short term but if more supply continues to come onto the market, it is possible that the market will run out of steam in the latter part of the year,’ he added.