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On The Market
The number of prospective buyers in the UK housing market has increased for the third consecutive month, according to the Rics Residential Market Survey.
The survey of chartered surveyors showed 13 per cent reported an increase in new buyer enquiries rather than a fall.
However, the survey showed supply shortages are leading to only a modest growth in sales activity and there has been a further decline in the amount of homes for sale.
Surveyors expect the beginning of 2017 to be quiet reflecting the lack of fresh properties coming to market.
As stock reduces the outlook for house price growth over the year to come is positive across the UK, with a net balance of 40 per cent of respondents forecasting a rise.
There is less confidence in the prospects for London property prices relative to other areas, with larger properties in the capital expected to show the slowest price growth.
The survey show that tax changes are still weighing heavily on the London market. The government has made tax increases on property at multiple levels, effecting developers and investors alike. The 3% stamp duty hike on buy to let has been negative; many new investors are looking to make use of companies as a route into the market. Charterhouse can provide specialist advice on this.
A key issue for the housing market is the slowdown in transaction activity since the spring, which is clearly being reflected in the Rics agreed sales data as well as in official figures.
Stock levels are around historic lows we expect any pick-up in activity to be gradual.
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New property listing prices have remained in line with the typical run-up to the summer holiday season despite Brexit concerns, Rightmove’s July house price index has revealed.
The portal claims the price of new property coming to market fell 0.9%, or £2,647, over the past four weeks to £307,824.
That covers the two weeks pre- and post- the EU referendum and is in line with usual activity over the summer, suggesting the predictions of a doomed property market are yet to emerge.
House prices are up annually at 4.5%, slightly slower than the 5.5% growth recorded last year.
Asking prices for first-time buyers fell 0.2% in July to £189,183 but second steppers and those on the top of the ladder saw bigger drops at 1.2% and 1.1% respectively
In the last two weeks post-referendum, compared to 2015, enquiries to agents from buyers were down by 16%.
However, Rightmove says last year’s figures were boosted by pent-up demand after the general election result, which saw a 25% uplift in buyer enquiries in June and July compared with the same two-month period in 2014.
The portal says a fairer comparison would be with 2014 when the demand levels were the same as now.
Sellers also seem undeterred by the referendum result.
Compared with the same period last year, the two weeks pre-referendum saw the number of new properties coming to market down by 8%, and the two weeks post-referendum saw them up by 6%.
Miles Shipside, director and housing market analyst for Rightmove, said: “As far as the price of property coming to market is concerned, the fall of 0.9% is within the range that we have seen at this time of year since 2010.
“With the onset of the summer holiday season, new sellers typically price more conservatively and the average drop in the month of July is 0.4% over the last six years.
“Perhaps unsurprisingly this July’s fall is marginally larger, as political turbulence has a track record of unsettling sentiment. Indeed last year saw a seasonally unusual 0.1% fall in the run-up to the May election, and a June and July price surge as a result of the post-election boost. Average new seller asking prices were up by 3.1% over that two-month period.”
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