House buyers and sellers ‘sit tight’ as Brexit uncertainty takes hold
Uncertainty caused by Brexit is causing house buyers and sellers in the West Midlands to sit tight in increasing numbers.
That’s according to the November 2018 RICS UK Residential Market Survey, which show a weaker trend in sales for the region than in previous months with the headline indicators for demand and supply falling once again, as almost half of respondents cite political uncertainty caused by Brexit as impacting the UK housing market.
The number of people looking for a new home in the West Midlands fell again in November (net balance of -35% down from -16% in October), with many comments attributing this to Brexit uncertainty.
Another contributing factor is the continued limited choice of properties for sale.
The number of new properties being listed for sale fell for the sixth consecutive report, and respondents in the West Midlands reported the weakest reading across all twelve regions (net balance of -42%) .
This lack of new stock is impacting estate agents’ average stock levels with agents now only having, on average, 28 homes for sale, a record all-time low. Additionally, the number of new appraisals by property valuers is down in comparison to a year earlier.
With little choice for new buyers and fewer people moving in the West Midlands, the number of agreed sales fell in November, albeit modestly. The UK headline net balance moved to -27% from -25% and this sentiment is reflected in almost all areas of the UK.
Looking ahead, contributors don’t see any change on the horizon. Sales expectations, for the coming three months fell from -4% to –8% in November, the third consecutive report respondents have suggested little improvement in the near term.
Despite the softer demand, regional house prices grew in November, (a net balance of +24% in November) However, the outlook in the near-term is more cautious. As seen in previous months, the regional picture remains varied, with house prices falling most notably in London, South East and East Anglia whilst the South West, East Midlands and North East are broadly flat.
Rises were seen in Northern Ireland, Scotland, Wales, Yorkshire & Humber and the North West.
Simon Rubinsohn, RICS chief economist, said: “It is evident from the feedback to the latest RICS survey that the ongoing uncertainties surrounding how the Brexit process plays out is taking its toll on the housing market. Indeed, I can’t recall a previous survey when a single issue has been highlighted by quite so many contributors.
“Caution is visible among both buyers and vendors and where deals are being done, they are taking longer to get over the line. Significantly the forward-looking indicators reflect the suspicion that the political machinations are unlikely to be resolved anytime soon. The bigger risk is that this now spills over into development plans making it even harder to secure the uplift in the building pipeline to address the housing crisis.”
