Property market activity sees sharpest decline on record
The residential market activity is still declining, but it’s predicted this will change in the near future, according to the RICS UK Residential Market Survey for July 2016.
Dwindling buyer enquiries, completed transactions and new instructions are all being put down to the ongoing Brexit uncertainties, as well as recent tax changes. However, updated yearly predictions are showing restored positivity in the market.
Although the first quarter of 2016 saw light relief of the acute property stock shortage, the preceding RICS reports have seen levels dropping again – with the sharpest decline in new sales listings on record.
July is said to be the fourth consecutive month of falls in new buyer enquiries across the majority of UK districts. Over a third (34%) more respondents have reported a decline in sales, with the pace being the most severe since 2008.
Andy Sommerville, Director of Search Acumen comments: “Today’s figures are one of the first indicators of the industry’s perspective following the Brexit decision and, although there has been a significant fall in activity in the past three months, the decline is one of smaller proportions than many were expecting. After the sharp initial fall in the midst of the Brexit vote, July’s survey shows that interest in the property market has continued to decline for the fourth consecutive month. However there is light at the end of the tunnel, and such doom and gloom in the sector could be coming to an end.
“Looking forward, the Bank of England’s rate cut last week will come as positive news to the market as current and potential homeowners will look to benefit from the attractive mortgage deals available. We anticipate the industry will start feeling this impact in the months ahead and we may even see a small surge in property transactions, especially as stability begins to return to the political system providing a more certain, investible future for consumers.
“This being said, in the short to mid-term, it is likely that housebuilders will slow down output of new homes in the wake of Brexit uncertainty, forcing supply and demand figures even further apart. The knock-on impact of this could have much more profound long-term implications for the market than the monthly rise and fall in transactions.”