UK property market lacking impetus, surveyors report

Small house builders hold the key to fixing Britain's broken housing market. Will they get the government support they need? And, what else is on the agenda for residential property in the UK?

Image of home being built, to illustrate an article on the UK property market lacking impetus
The UK housing market continued in the doldrums in March, with new buyer inquiries and agreed sales stagnant, according to the latest report from property surveyors.

Housing sales growth to continue to fall for the rest of 2017

The report from the Royal Institution of Chartered Surveyors (RICS) indicated the mood had now spread to would-be sellers with the number of properties coming on to the market dropping further, resulting in a fall in predictions for sales growth for the rest of the year.Stock levels hit a new record low with surveyors reporting an average of 43 unsold properties per branch last month, the lowest figure since the RICS started collating the figures almost 40 years ago with a net balance of 13 per cent of institution members reporting a decrease, rather than an increase, in fresh properties coming on to the market.

New house buyer enquiries have been flat

New buyer enquiries have now been flat for three months in a row with demand highest in Northern Ireland and SW England, but slow in London. However, the report found that demand in the lettings market had continued to grow with a balance of 11 per cent recording an increase, rather than a fall.Simon Rubinsohn, chief economist at RICS, said, "The latest results for the Rics survey show little change in the underlying picture surrounding both sales and markets."High-end sale properties in central London remain under pressure, while the wider residential market continues to be underpinned by a lack of stock. This includes rents, with rents away from the capital generally moving higher as demand outstrips supply."For the time being it is hard to see any major impetus for change in the market, something also being reflected in the flat trend in transaction levels."
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Housing affordability issues and economic uncertainty continue to plague UK housing sector

Richard Sexton, director at e.surv, said it was frustrating to see the market dip slightly in March. "Transactions have remained flat for a while now, in part due to a lack of affordable housing for first time buyers, which has led many people to continue renting or move back in with their parents in order to save for a deposit," he said."The issue of affordability continues to plague the sector, and the wider economic uncertainty we have experienced recently has only added to this, causing more buyers to adopt a more cautious approach and hold off making big decisions until certainty returns."We urge the government to start working closely with the industry to meet its target of 250,000 homes being built this year and give more people the opportunity to own their own home."Robert Grigg, managing director of property finance at the Hampshire Trust Bank, said he expected a fall in property prices in the near future owing to the cyclical nature of the housing market. "Looking to the future, our biggest concern will be how smaller housebuilders will fare when the market begins to contract," he said."We know the Government has highlighted the need for better support for smaller housebuilders as they hold the key to fixing the UK’s broken housing market. Therefore as Brexit negotiations get underway, we need to ensure these firms stay high on the agenda as their contribution to the long-term success of the UK economy is vital."

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