Long-Term Optimism For The Property Market Reduces In March
A leading market survey has concluded that Brexit uncertainty is set to shroud the property market with continued difficulties for a further six months and long-term optimism in the housing market is reducing.
However, overall the monthly sentiment in the March UK Residential Market Survey, carried out by The Royal Institution of Chartered Surveyors (RICS), is a lot more optimistic than the February instalment.
In terms of new buyers entering the market in March, the report highlights that whilst more respondents are seeing decreases than increases, the gap is narrowing overall. The new Buyer Enquiries series returned a balance of -27% in March. However, this is considerably more positive than the -40% recorded a month earlier.
The number of agreed sales within the property market was also delivering a negative net balance of -24% in March. Whilst this is a 6% improvement from the -30% recorded in February, the figures suggest that the market may struggle for the foreseeable future.
Almost a quarter more of the RICS respondents viewed prices as falling in March. In February -27% viewed prices as becoming a concerning factor through the price net balance. This figure improved to -24% in March but highlights a concern that house prices will have on the short-term property market.
Although the sentiment is improving month on month, there has been a reduction in the amount of respondents viewing the long-term market with optimism. The 23% of respondents that predicted the 12-month outlook would become a lot more positive has now reduced to 15% as a prolonged Brexit casts further shadows on the property market.
Simon Rubinsohn, RICS Chief Economist, 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.
“Arguably more significant still are the signs that developers are continuing to adopt a more cautious stance with the trend in new residential starts now flat-lining. Against this backdrop, there is little possibility of delivering the uplift in supply necessary to address the ongoing housing crisis.”
Is the conveyancing sector noticing a reduction in transactions? Have you noticed a fear in property because of Brexit uncertainty?