Consumer apathy sees housing market continue to stagnate

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The West Midlands housing market continues to stagnate with little change on the trend which has characterised much of the first half of the year.

The latest RICS UK Residential Market Survey for the region showed new buyer enquiries, new instructions and newly agreed sales all remaining in negative territory.

Although prices continue to rise, near term expectations see them increasing at a slower rate. The latest survey showed house price inflation dropping further in June. At the same time, there is little encouragement for sales activity with agreed sales declining alongside new buyer enquiries and new instructions.

Those responding to the survey cited domestic political uncertainty and Brexit as the biggest influences for rising house prices and subdued activity.

Simon Rubinsohn, RICS Chief Economist, said: “The latest results demonstrate the danger, however tempting, of talking about a single housing market across the country.

“RICS indicators particularly regarding the price trend are pointing towards an increasingly divergent picture. High end prime properties may be seeing prices slipping back but, for good or ill, prices are continuing to move higher in many other segments of the market. Indeed, the disaggregated data suggests that this will continue to be the case over the coming months

“Perhaps not surprisingly in the current environment, the term ‘uncertainty’ is featuring more heavily in the feedback we are receiving from professionals working in the sector. This seems to be exerting itself on transaction levels which are flatlining and may continue to do so for a while particularly given ongoing challenge presented by the low level of stock on the market.”

Regionally, Richard Franklin, of Tenbury Wells agency, Franklin Gallimore said: “As if Brexit wasn’t bad enough current inertia in the market have been compounded by gross political uncertainty which does not enable people to plan and end up doing nothing.”

Ryan Williams, of Hay on Wye agency, McCartneys added: “Political uncertainty has caused a stutter in demand as people hesitate. Still a drift away from the cities which underpins our market out in the sticks.”

John Ozwell, of Solihull agency, Hunters, said: “West Midlands markets has been strong for longer than other areas but now slowing. Prices seemed to have peaked.”