The number of home buyers has dropped for the sixth month in a row helped by jitters among buyers over a potential interest rate rise, the Royal Institution of Chartered Surveyors (RICS) has revealed.
Its housing market survey for September found that the number of buyers dipped noticeably over the month with 20% more surveyors noting a fall in buyers than a rise in demand, and that London’s problems are beginning to spread out from the capital.
Only Wales and the South West saw more surveyors recording an increase in sales than a decrease, with the rest of the UK remaining flat – although London and the South East lead the declines.
On top of this, RICS also says the number of surveyors reporting fewer agreed sales versus a rise increased by 15%, the “softest reading since last July during the aftermath of the EU Referendum”.
While buyers continue to keep away from the market, the number of homes available for sale remain stable having declined over the past 18 months.
On average stocks levels on estate agents’ books are holding up at 43.3 properties per branch.
Looking forward, RICS doesn’t expect the market to pick up over the next yeaar but despite such a flat market, house prices continue to rise, continuing at 6% a year during September, although prices are “firmly negative” in London and the South East.
“It was always questionable to talk about the housing market as a single entity but the stark divergence in key readings from the latest RICS survey demonstrates in the clearest possible terms just how important the regional narrative is at the present time,” says Chief Economist Simon Rubinsohn (pictured, left).
“In part, this is a reflection of affordability constraints hitting the higher priced segments of the market. It is perhaps also indicative of a shift in economic momentum in the face of the increasing possibility of the first hike in base rates in over ten years.”
But the rental market is a very different picture. Increased interest from prospective tenants increased during September, with 10% more lettings agents noting rising enquiries than those experiencing a decline, although landlord instructions have been declining – although so far this hasn’t pushed up rents, as might be expected RICS says.