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RICS: New buyer enquires up 14% in June

The Royal Institution of Chartered Surveyors (RICS) UK Residential Market Survey has outlined that new buyer enquires rose by 14% in June.

Although this is the fourth successive positive monthly reading, it does represent a noticeable moderation compared to the recent high of 43% in April.

RICS found that the net balance for new instructions came in at -34% during June, compared to -24% previously, which was consistent not only with a third consecutive monthly fall in new listings, but also points to an accelerated rate of decline.

While a net balance of +17% of survey participants still noted that the number of market appraisals being undertaken is running ahead of the comparable period last year, the net balance was +34% in April and +24% in May.

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Meanwhile, the number of agreed sales picked up in June, evidenced by a net balance of +8% of respondents noting an increase; again, however, the net balance for this metric has eased over recent months, having hit +46% back in March.

Looking ahead, near-term sales expectations are now signifying a broadly flat outlook in the three months ahead, with the latest net balance slipping to -4% from +8%.

Moreover, the 12-month sales expectations series returned a net balance of -12% during June, down from -5% previously.

Alongside this, a national net balance of +83% of respondents cited an increase in house prices over the survey period, comparable to the +82% that said this in May.

RICS noted that all parts of the UK continued to exhibit strong rates of house price inflation in June, led by robust upward pressure in Yorkshire & the Humber, Northern Ireland and Wales.

A net balance of +56% of survey participants sense that prices will increase further over the next 12 months.

In the lettings market, tenant demand growth seemingly accelerated over the month, with a net balance of +60% of contributors noting a rise, up from a reading of +48% in May.

At the same time, the shortfall in new landlord instructions intensified, as a net balance of -32% of respondents saw a decline, a deterioration on -21% previously.

Survey participants envisaged widespread rental growth going forward, with headline projections standing at +3% for the coming 12 months.

Sarah Coles, personal finance analyst at Hargreaves Lansdown, said: “Panic buyers have been clearing the shelves at the estate agents again.

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“The number of new properties for sale fell for the third month running, so although buyers have come to the market more slowly, there are still plenty of them to ensure any promising new property is snapped up overnight.

“It means buyers are getting sucked into a race to make an offer, then a bidding war, and even after they secure a property, they run a bigger risk of being gazumped.

“It’s a vicious circle, because potential sellers can’t see anything they want to buy at the moment, so they don’t list.

“It means anyone who might have wanted to buy their home doesn’t have anything to buy so they don’t list either, and so on.

“As a result, prices continue to rise, and the RICS survey respondents expect more increases through the rest of the year.

“A shortage of properties, and record low mortgage rates are likely to underpin the market for a while to come.

“However, the pace of sales seems likely to slow as the stamp duty holiday comes to an end in September.

“Agents are erring on the side of caution, expecting a flat market in the next three months and fewer sales in the next 12 months.

“Whether this brings about a slowing of price rises, a flattening, or something more dramatic, depends on what happens in the broader economy.

“A very strong economic recovery raises the possibility of inflation and potential interest rate rises, which could hit the property market.

“On the flip side, new variants or a rise in hospitalisations that forces a return to lockdowns and closure of businesses, could damage the recovery and force job losses, which would also hit property.

“The property market flourishes in a goldilocks economy, and there are no guarantees of this as we go further through the year.

“This level of uncertainty means potential buyers need to consider all eventualities.

“If they’re buying an affordable property that they plan to stay in for the foreseeable future, and can cope with potential rate rises, then they may be perfectly comfortable.

“However, if they’ve over-stretched themselves and over-paid, this could be a good time to reconsider their position.”

Tomer Aboody, director of property lender MT Finance, added: “With a dearth of properties on the market, and demand at its highest level in a long while, quality properties are selling quickly and at increased values.

“A reduction in instructions will help continue this upwards trend as multiple buyers fight it out for their dream home and can access cheap mortgage rates.

“Values for desirable homes in particular will continue to rise in the near future while the government continues to support the market but more importantly while money is cheap to borrow.

“The government needs to assist sellers in putting properties on the market, and this could be by reforming the stamp duty for downsizers.”

Jeremy Leaf, north London estate agent and a former RICS residential chairman, said: “The market paused in June as many buyers and sellers realised they just would not be able to take advantage of the stamp duty concession before it tapered off.

“The frenzy of April and May was replaced by an opportunity for many to try to take advantage of the increased balance in supply and demand, and give themselves a better chance of moving.

“Unfortunately, supply is still not increasing fast enough, despite the faster vaccination rollout.

“Nevertheless, we don’t expect a significant correction in prices, more of a softening at least for the next few months as confidence in the economy seems to be more of a priority than worries over the ending of the furlough scheme.”

By Jake Carter

Source: Mortgage Introducer

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RICS: Buyer enquiries continue to pick up

A net balance of 52% of RICS surveyors noted an increase in new buyer enquiries in September.

New instructions coming onto the sales market also rose for a fourth month in a row, which now signifies the longest stretch of rising supply going back to 2013.

Tenant demand mostly increased, though it fell in London.

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Alan Cleary, managing director for mortgages at OneSavings Bank, said: “Evidence from the latest RICs market survey shows house prices rising strongly and tenant demand remaining firm in September, though falling a little from the high levels reached in July and August.

“Rising house prices should provide a natural support to rental growth. The immediate outlook is for a period of robust growth in overall levels of housing market activity, with transactions and prices continuing to drift upward.”


Source: Property Wire

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RICS: Stamp duty holiday helping to lift demand

The stamp duty holiday introduced from the 8th July is helping to lift demand, The RICS UK Residential Market Survey suggests.

In July a net 75% of surveyors saw a rise in new buyer enquiries, the second month in a row that demand has rebounded significantly. A net 59% also saw instructions rise, up from 41% in June.

RICS noted that the stamp duty holiday is having a big impact on demand based on anecdotal evidence.

Ross Counsell, chartered surveyor and director at property buyers, Good Move, said: “Today’s RICS statistics reveal the UK housing market gained further momentum last month which showcases the ongoing recovery – something we’re all happy to hear after a turbulent few months.

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“We have seen an increase in new buyer queries, as well as a rise in new listings and sales. The measurements employed by the government such as the stamp duty holiday has positively impacted this spike.

“These latest statistics should hopefully help reassure buyers and sellers in the UK that the property market is starting to return to “normal”.

“However, we must not forget that we are now in a recession, therefore we advise buyers who are looking to purchase a home during the recession to thoroughly check out the property before they commit, and ask important questions such as how much work the property may need to ensure they’re protecting their finances and getting the best possible deal.

“Buyers must not get swept away in a low house price or jump at the first-rate a mortgage lender offers. Purchasing a home during this time is a big decision and one that needs to be thought about carefully.”

A net 26% of surveyors expect an increase in sales, however a net -10% expect sales to tail off over the course of the next 12 months – likely due to the stamp duty holiday expiring in March 2021.

Tomer Aboody, director of property lender MT Finance, said: “With the stamp duty holiday in place at least until March and hopefully longer, this should help support the housing market to a degree.

“No doubt there will be some negativity and a potential fall in confidence after government schemes such as furlough have ended but a possible downward trend should be eased by banks already preparing a loss buffer (HSBC), allowing them to work more closely with borrowers who might be struggling with repayments.”


Source: Property Wire

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RICS: New buyers looking for green spaces as Scottish property market prepares to open

Following the reopening of the housing market in England May 13, the May 2020 RICS Residential Market Survey unsurprisingly saw a slight improvement in the outlook for sales over the coming twelve months across the UK as a whole.

As the housing market in England started to get going, the UK headline net balance for new buyer enquiries moved from a record low of -94% in April, to post a reading of -5% in May.

Activity metrics though did not see meaningful changes in Scotland, Northern Ireland and Wales, where restrictions on estate agents were not removed in May.

In Scotland, the indicator for new buyer enquiries remained close to a record low of -81% and the indicator for newly agreed sales was at similarly low levels of -84%.

However, Scottish respondents were less pessimistic regarding the outlook, with a net balance of -10% recorded for sales expectations over the next three months, likely to be influenced by an expectation that restrictions on the market will be lifted. And 12-month sales expectations turned positive (moving from -18% to +10%) for the first time since February.

In an extra question included in the May survey, as housing markets either opened or prepared to, contributors were asked for their views and for information on what is coming up when speaking to buyers, regarding potential shifts in the desirability of certain features of properties over the next two years (owing to recent events).

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81% of respondents across the UK felt that there will be an increase in desire for properties with gardens or balconies; 74% predict an increase in demand towards homes located near green spaces; and 68% are of the opinion that properties with greater private and less communal space will become more desirable.

At the other end of the scale, 78% of respondents sense there will be a fall in the appeal of tower blocks and 58% feel properties located in highly urban areas will be less enticing. Interestingly, the majority expect no change in the desirability of homes located near transport hubs.

Hew Edgar, head of UK Government relations and city strategy, said: “As Scotland eyes up the highly anticipated reopening of the housing market, potentially next week, this month’s survey feedback provides valuable insight that can inform the Scottish Government and developers of new housing requirements. It is clear that post-lockdown buyers are beginning to reappraise high-density living and looking for more space.

“Space inside their future homes and outside. What is also clear is that the Scottish workforce is looking to spend more time at home, and this will inevitably increase bills for owner-occupiers, and tenants in both the private and social rented sectors. As such, the Government should look at ways to incentivise the repair, maintenance and improvement of existing properties as a means to ensure the health and wellbeing of individuals working from homes in Scotland, as well as restricting a possible increase in fuel poverty.”

Alex Inglis MRICS of Galbraith Group in the Scottish Borders, added: “Little sales activity has taken place during the lockdown but selling clients are generally still keen to get things under way when the lockdown is eased. Potential buyers are generally still hoping to move. There is particular demand for rural and village / small town properties.”

Looking at some of the other regular indicators in Scotland, the indicator for prices over the last three months moved from a net balance of -20% in April to -14% in May. And near-term price expectations moved from -68% to -60%. Instructions to sell remained firmly in negative territory, with 100% of Scottish respondents saying that the number of new instructions from vendors fell last month.

Commenting on the UK picture, Simon Rubinsohn, RICS chief economist, commented: “Following the reopening of the housing market in England, pre-Covid sales that were in the pipeline are now largely going through. This is encouraging but it remains to be seen how sustained this improvement will prove. Much will inevitably depend on the macro environment and, in particular, the resilience of the jobs market as the furlough scheme unwinds. For the time being respondents to the survey see the trend in transactions being broadly flat.

“Alongside this, there are already signs that those looking to buy a house are responding to the conditions created by the pandemic by seeking out properties with gardens or balconies and nearer green space. These and other similar features are likely to increasingly command a premium over higher density urban locations according to respondents to the survey.”

Source: Scottish Housing News

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RICS: Enquiries stabilise and desire for green space increases

New buyer enquiries posted a net reading of -5% in May, indicating that the market is stabilising after plummeting the month before, RICS UK Residential Market Survey has found.

Near term sales expectations are broadly neutral, with a net balance of -4%, while 12 month expectations are slightly positive, with a net 10% expecting sales to increase.

In terms of how RICS have perceived house price changes over the past three months, -32% saw them fall, down from -22% in April.

Jeremy Leaf, north London estate agent and a former RICS residential chairman, said: “There is no doubt that there has been some release of pent-up demand as buyers and sellers emerge from enforced confinement, with many realising their present properties are unsuitable and trying where possible to bag a bargain.

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“The reality is that many sellers are reluctant to reduce the price substantially as around four out of five tend to be buyers too. They will only consider price drops if they can secure a similarly good deal on their next property.

“Overall, first-time buyers in particular seem more nervous about employment prospects as the furlough support falls away. We are seeing more demand for smaller family houses where buyers are taking a longer-term view of market prospects.”

Some 81% of respondents feel there will be an increase in desire for properties with gardens or balconies.

At the same time, 74% feel there will be a shift in demand towards homes located near green spaces and 68% are of the opinion that properties with greater private and less communal space will become more desirable.

Tomer Aboody, director of property lender MT Finance, said: “Buyers are focusing on outside space and parks, which will in turn provide a resurgence in interest in the home counties as buyers feel they can get more bang for their buck the further out of the city centre they are prepared to go. This will also give them more indoors space to work from home in future, and perhaps make a second lockdown easier to deal with.

“Whereas this would be a natural human reaction to the current situation, there will still be those buyers who would rather be close to central London and avoid the commute in, which has always been an issue due to overcrowded trains. This could push up prices of London homes with gardens or other outside space.

“We are seeing some confidence among buyers. With very little stock on the market in the short term at least, transactions are completing.”


Source: Property Wire

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RICS and NFB call for stamp duty holiday

The Royal Institute of Chartered Surveyors (RICS) and the National Federation of Builders (NFB) have called for a stamp duty holiday once the lockdown ends.

RICS members are expecting house prices to fall over the next 12 months – but the organisation said temporarily removing stamp duty would help quickly get the market running again.

Hew Edgar, RICS head of government relations, said: “RICS is not an organisation that would call for a stamp duty holiday on a whim.

“As we start to emerge from this crisis, however, it is likely that the finances of potential homebuyers will be under strain, and the burden of stamp duty could put buyers off.

“For those who can afford to move they may lack confidence in the market, adding to the slow down.

“A stamp duty holiday could be one of the ways to reactivate the housing market quickly as a short term measure.”

Afterwards the NFB backed the call.

Richard Beresford, chief executive of the NFB, said: “A temporary stamp duty holiday would encourage new build sales and release some much needed cashflow back to our struggling housebuilders.

“It would also ensure vital businesses, such as surveyors and conveyancers, are able to continue operating in these difficult times. We support it.”

The National Federation of Builders also backed are campaigns to defer planning contributions and council tax on vacant new builds, as well as extend planning permissions by 12 months.

Rico Wojtulewicz, head of housing and planning policy at the House Builders Association (HBA), the housebuilding division of the NFB, said: “Housebuilders, many of whom are struggling to get lending from the government CBILS scheme, are still expected to pay bills, their staff and the supply chain but with reduced or no revenues.

“A temporary stamp duty holiday is another immediately deliverable solution that the government should pursue.

“Any delay in increasing support to our industry will see businesses go to the wall and once one goes, the domino effect will be striking.”


Source: Property Wire

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Sales pick up as confidence in housing market translates into activity

Increased optimism from buyers has led to a pick-up in sales activity in the Scottish housing market, according to the January 2020 UK Residential Market Survey from the Royal Institution of Chartered Surveyors (RICS).

Whilst the picture regarding the number of homes being listed for sales was flat during January, the number of people looking to buy rose, according to a net balance of +22% of Scottish respondents.

This resulted in the number of newly agreed sales increasing over the month, with a net balance of +11% of surveyors saying that there were more newly agreed sales in January compared to December.

Prices also continue to rise last month, according to the survey. A net balance of 32% of Scottish respondents said that prices increased, the highest since July 2019, and higher than all UK regions other than Northern Ireland.

Looking ahead, respondents to the survey in Scotland remain confident about the outlook, with sales anticipated to rise both in the near term and for the year to come. A net balance of +70% of Scottish respondents expects prices to be higher in a year’s time. A net balance of 54% expects sales activity to increase over the next 12 months.

Despite the improvement in buyer demand though, instructions to sell have not picked up, with the balance for instructions to sell flat.

This follows a sustained period of falling supply, meaning that stock levels are low. Indeed, anecdotally, a number of respondents in Scotland say that there is an under-supply of good properties available to meet the demand, and that this is the main risk to the market at present.

Grant Robertson, MRICS of Allied Surveyors in Glasgow, said: “Sales remain strong when there is something to sell. The modest post-election surge bodes well for 2020 but stock needs to start releasing or values will surge and kill the market.”

Graeme Lusk MRICS of Walker Fraser Steele based in Glasgow and Renfrewshire, added: “The market is beginning to come out of its winter slumber. But there is still an under-supply of quality properties on the market and buyers waiting. A good time to put your property on the market.”

In the lettings market, demand for rental properties in Scotland rose in the three months to January (seasonally adjusted quarterly series), with a net balance of +29% of respondents citing an increase.

At the same time, the balance for landlord instructions rose for the first time in 16 months, though only very modestly (a net balance of +6%). Despite the slight pick-up in landlord instructions, there is still a mismatch between demand and supply, and rents are therefore expected to rise in the next three months.

Simon Rubinsohn, RICS chief economist, said: “The latest survey results point to a continued improvement in market sentiment over the month, building on a noticeable pick-up in the immediate aftermath of the General Election.

“It remains to be seen how long this newfound market momentum is sustained for, and political uncertainty may resurface towards the end of the year. But, at this point in time, contributors are optimistic regarding the outlook for activity over the next twelve months.”

Source: Scottish Construction Now

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Activity picks up in the north’s housing market during January, new survey suggests

ACTIVITY picked up in the north’s housing market during January, a new survey conducted within the industry suggests.

The first residential market survey of the new decade from RICS (Royal Institution of Chartered Surveyors) and Ulster Bank, found a rise in the number of new buyer enquiries and instructions to sell.

Largely based on the responses from Northern Ireland estate agents, the latest housing report follows two months of consecutive falls in newly agreed sales.

Optimism is also up within the sector, following the decisive win by the Conservatives in December’s general election and the restoration of the Stormont Executive.

But the rise in activity has prompted RICS to once again highlight the availability of housing stock as a key challenge within the market.

The body reported anecdotal response to the survey, citing an insufficient supply of resale properties.

Residential property spokesperson for RICS in Northern Ireland, Samuel Dickey, said: “There has been a clear improvement in sentiment in the housing market with local as well as national political developments likely to be a factor.

“The rise in new sales instructions coming onto the market is a noteworthy and much needed development, given the lack of fresh listings over the past few years.

“Political uncertainty may resurface towards the end of the year but, at this point in time, contributors are optimistic regarding the outlook for activity over the next twelve months.”

Head of personal banking at Ulster Bank, Terry Robb said the lender had noticed a rise in mortgage enquiries and interest in the early part of the year.

“This will likely translate into good sales activity in the months ahead, particularly if more homes come onto the market and available for sale.”

The Northern Ireland survey mirrored similar reports of positive uptakes in the housing market from across the UK.

Property portals and Rightmove both recently reported seeing record traffic to their websites in January.

Last week, Halifax reported that UK house prices increased by 0.4 per cent month-on-month in January – although that report said that it was too early to say if a corner has been turned.

Simon Rubinsohn, RICS chief economist, said: “The latest survey results point to a continued improvement in market sentiment over the month, building on a noticeable pick-up in the immediate aftermath of the general election.

“The rise in new sales instructions coming onto the market is a noteworthy and much needed development, given the lack of fresh listings over the past few years had pushed stock levels to record lows.

“It remains to be seen how long this newfound market momentum is sustained for, and political uncertainty may resurface towards the end of the year.

“But, at this point in time, contributors are optimistic regarding the outlook for activity over the next 12 months.”

By Ryan McAleer

Source: Irish News

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UK Housing Market on the Up, Says RICS

The UK housing market seems to be gathering pace following last month’s General Election, according to the Royal Institution of Chartered Surveyors (RICS).

The latest RICS survey revealed an increase in both the number of sales and buyer enquiries in December for the first time in seven months. According to RICS, house prices across the country are set to rise in 2020 due to a less volatile political and economic climate following the Conservatives landslide election win last month.

The figures were boosted by a sharp increase in sales in London and the South East of England, although in Scotland and Northern Ireland property sales fell. Heightened interest from new buyers in Wales and the North East of England also helped to drive up expectations for the year ahead.

According to the survey, 66% of RICS members expect positive house sales growth over the next year, a massive jump from the 35% that expected it just a month ago.

“The signals from the latest RICS survey provides further evidence that the housing market is seeing some benefit from the greater clarity provided by the decisive election outcome,” said Simon Rubinsohn, chief economist at RICS.

“Whether the improvement in sentiment can be sustained remains to be seen given that there is so much work to be done over the course of this year in determining the nature of the eventual Brexit deal.

“However, the sales expectations indicators clearly point to the prospect of more upbeat trend in transactions emerging with potential purchasers being more comfortable in following through on initial enquiries.

“The ongoing lack of stock on the market remains a potential drag on a meaningful uplift in activity although the very modest increase in new instructions in December is an early hopeful sign.

“Given that affordability remains a key issue in many parts of the country, the shift in the mood-music on prices is a concern with even London expectations pointing to a reversal of course both over the coming months and looking further out.

“This highlights the critical importance of the government addressing the challenge around housing supply particularly with the gradual phasing out of the Help to Buy incentive.”

Independent property expert Henry Pryor said: “Transaction volumes have held up well last year but while it feels like there may be a little more life in the market and some signs of confidence returning to the middle and upper ends there is no actual evidence of a Boris Bounce just yet.

“The data won’t be available until May as it takes time for sales that are agreed to exchange and complete and then another month to appear in the official records. However, it does seem like more people are thinking of moving, more homes are coming to market, and some buyers are bored of putting their lives on hold and want to get on with their lives.

“Will it last? Well, there are still some big icebergs ahead of us – the Budget next month, ongoing negotiations with Europe, a possible return of the Beast from the East. Any one of these could knock confidence and snuff out the fragile optimism, but if you want to buy or sell it looks like 2020 may be your year after all.”

Source: Money Expert

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UK house prices fall at fastest rate in seven months – RICS

UK house prices dropped last month by the most since April, as uncertainty about Brexit and the election weighed on the property market, the Royal Institution of Chartered Surveyors (RICS) said on Thursday.

The RICS survey – released on the day Britain votes in a national election intended to break a parliamentary deadlock over Brexit – showed home-buyers and sellers stuck on the sidelines.

The monthly house price balance declined to -12 in November, its lowest since April, from -5 in October.

The number of new buyers and sellers continued to fall – though the drop in sales seemed to be bottoming out and the proportion of surveyors who expected a rebound in activity over the next year rose to its highest since February 2017.

“Whatever happens in the general election today, it is important that the new government provides reassurance both over the stewardship of the economy and the ongoing challenges around Brexit,” RICS chief economist Simon Rubinsohn said.

Britain’s housing market has slowed since June 2016’s Brexit referendum. Prices have fallen in London and surrounding areas, where a rise in property purchase taxes bit hardest and concerns about Brexit were high.

Official data has shown that British house prices rose by 1.3% in the year to September and a Reuters poll of economists has forecast a 1.5% rise for 2020.

Prime Minister Boris Johnson intends to take Britain out of the European Union by Jan. 31, if he wins Thursday’s election. Most opposition parties have said they want a second referendum.

Reporting by David Milliken

Source: UK Reuters