Housing sales expected to fall amid ‘downbeat’ outlook

A net balance of 28 per cent of Royal Institution of Chartered Surveyors (RICS) members expect house sales to fall in the next three months, with the housing market outlook over the next three months recorded as the worst for 20 years.

The most downbeat reading since records started in October 1998, housing experts say that pessimism is blamed on the lack of clarity around Brexit, while lack of supply and affordability also continued to affect the market.

According to RICS, sales expectations for the next three months are now either flat, with no change predicted, or negative, indicating falling sales, across all parts of the UK.

The report finds that new buyer inquiries fell for the fifth month in a row in December, while increasing numbers of surveyors reported seeing house prices fall rather than increase, with a net balance of 19 per cent seeing falls rather than rises. That figure was a rise on a balance of 11 per cent in November and marked the fourth month in a row of negative house price readings.

Simon Rubinsohn, RICS chief economist, said: “It is hardly a surprise with ongoing uncertainty about the path to Brexit dominating the news agenda, that even allowing for the normal patterns around the Christmas holidays, buyer interest in purchasing property in December was subdued. This is also very clearly reflected in a worsening trend in near term sales expectations. Looking a little further out, there is some comfort provided by the suggestion that transactions nationally should stabilise as some of the fog lifts, but that moment feels a way off for many respondents to the survey.

“Meanwhile it is hard to see developers stepping up the supply pipeline in this environment. Getting to the government's 300,000 building target was never going to be easy but pushing up to anywhere near this figure will require significantly greater input from other delivery channels including local authorities taking advantage of their new-found freedom.”