Buyer enquiries have started shrinking as the government’s stamp duty holiday begins to taper off, according to the latest RICS residential market survey.
A net balance of -9% of agents saw a fall in July, down from +10% in June, and ending a positive four-month streak for the housing market.
Agreed sales took a dip as result, posting a net balance of -21% last month across the UK, with sales volumes slowing most notably in Yorkshire & the Humber, the East Midlands and East Anglia.
RICS reports that house price growth was again impacted by the lack of properties ready for sale, with a net balance of -46% of agents reporting a fall in new listings (down from -35% in June), while +78% reported rising house prices, which is slightly down from the +82% reported in the past two months.
The North of England, Wales and East Anglia saw especially strong growth and London’s latest net balance of +45% was up on previous results.
Demand from tenants looking to rent new homes remained strong for the fifth quarter in a row, with a net balance of +52% reporting a rise across the UK.
With new instructions from landlords remaining in decline, rents are now expected to rise over the next three months.
Simon Rubinsohn (pictured) RICS chief economist, says a strong message from survey respondents is that buyers are continuing to place a premium on space, and that the prospect of a hybrid model of work being adopted by many organisations is providing the opportunity for greater flexibility around location.
He adds: “This is being reflected both in the challenge some current homeowners are having in moving up the property ladder as well in stronger price expectations from the RICS survey for larger than smaller properties.”
Jeremy Leaf, north London estate agent and a former RICS residential chairman, says: “‘The market is showing considerable resilience. These figures confirm much of what we’ve been seeing on the ground since the stamp duty concession began to taper at the end of June. The frenzy of the last few months was unsustainable so a reduction in activity and softening of prices does not come as a surprise.
“However, the difference has proved to be virtually seamless and only what we might have expected at this time of year. Enquiries are down but their quality is definitely still there. Low stock levels are continuing to underpin prices but the number of appraisals recently carried out gives us confidence listings will pick up soon.
“A levelling up between supply and demand, combined with improving economic and Covid news, is the likely outcome this autumn.”