Long term outlook sees uplift despite drop in agreed sales
Whilst December saw a decline in agreed sales, the long-term outlook for the property market has seen an uplift.
The results of the December 2017 RICS UK Residential Market Survey still show a slowdown in headline momentum, with short-term indicators slightly negative or relatively unchanged. However, the market outlook on a medium-term basis is slightly more positive.
The final month of 2017 saw the headline price balance grow to 8%, a healthy uplift from November’s 0. Though this percentage runs parallel to the slight growth observed in prices, London continues to stay in negative territory (-32%) when the regions are looked at individually. The survey results in most other locations seemed healthier, with the highest figures being seen in the North West, Wales, the Midlands and Northern Ireland.
Looking at short-term expectations on a national level, the outlook continues to be negative with a net balance of -6%. In concurrence with the price balance, London’s expectations remain the lowest, with Wales, Scotland and Northern Ireland showing the most positive expectations for the months ahead.
In comparison to the previous report, new buyer enquiries saw a slight fall, with a net balance of -15% of respondents reporting a drop in demand rather than a rise. This can be compared to the November’s figure of -5%. Given that November saw Stamp Duty abolished for many first-time buyers, contributors to this report were asked if they had noted an increase in the number of enquiries following the Autumn Budget. Whilst 86% stated that they had not, this has in some part been attributed to the Christmas holiday period.
At a national level, -13% of respondents reported a fall in the level of agreed sales, down from November’s reading of -10%. The only areas to see an uplift in transactions were Scotland, the North East and Northern Ireland, with the remaining areas across the UK staying flat or seeing a modest decline.
Whilst sales expectations on a near-term level remain largely unchanged, the annual outlook seems more promising. In fact, across all regions, activity is expected to grow.
The stamp duty change was also considered on a 12-month level, with two-thirds of contributors feeling that it would have little impact on the market. 12%, however, thought it might result in higher activity overall, with 28% of London respondents taking this view.
Where supply is concerned, new instructions to sell decline; this makes November 2017 the 23rd consecutive month where a positive headline reading has not been reported. Contributors elaborated on this trend, with many highlighting the negative impact it’s having on the wider market.
Whilst the average number of available properties on estate agent books remained steady, this figure is close to the lowest point on record.
The full report can be accessed here.