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HOUSING MARKET DEFIES BREXIT GLOOM

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Thu 15 Sep 2016

HOUSING MARKET DEFIES BREXIT GLOOM

SURVEYORS MORE OPTIMISTIC AS HOUSING MARKET DEFIES BREXIT GLOOM

Surveyors have been pretty dreary in the aftermath of the Brexit vote, but new data suggests that could be set to change.

The RICS August Residential Market Survey, published this morning, found that expectations for prices and sales seem to be on the rebound.

During August 12% more respondents nationally reported an increase in prices, up from 5% more in July, reversing a run of five consecutive surveys in which the net balance has decelerated.

Demand is still an issue but the net balance moved from 25% reporting a drop in July to 7% more showing a fall in August, according to the survey.

Sales expectations over the next three months nationally moved into positive territory with 13% more expecting a rise, up from 2% more expecting a drop in July.

Over 12 months, 29% more expect sales to increase, an increase from July when 13% were expecting more sales.

The survey also asked respondents for a more detailed breakdown of changes in new buyer enquiries over the past three months, finding 57% more reported a drop in buy-to-let enquiries.

Over the same period, demand from first-time buyers and existing owners also reportedly fell, but to a smaller degree, with 15% and 11% more reporting falls.

This suggests the Stamp Duty rush could be having more influence on the market than the Brexit vote, and some of the comments in the survey also support this. Most comments point to the seasonal slowdown and Stamp Duty rather than Brexit hitting the market.

Simon Rubinsohn, RICS chief economist, said: “There are clear signs that the housing market is settling down after the initial surprise of the outcome to the EU referendum.

“Buyer enquiries did dip again in August but only modestly, and more significantly, sales expectations are beginning to edge upwards once again.

“It is likely the swift response from the Bank of England, both in terms of the lowering of the capital buffer and the cut in interest rates, has played a role in helping to support confidence.

“The more assured mood is also reflected in some of the longer-term RICS indicators, although this in itself could serve to re-ignite ongoing concerns surrounding affordability with five-year projections for both prices and rents in the latest survey back to their highest level since May.”