Continuing uncertainty hitting Yorkshire housing market sales

Sales activity in Yorkshire and Humber’s housing market is not expected to pick-up over the coming three-months, according to the monthly RICS Residential Market Survey results.

During the month of August, 28% more agents in the region predicted a decline in sales activity over the next three months (up from 9% back in July).

Sales expectations have weakened in almost all parts of the UK over the past two months with Brexit uncertainty cited as a significant factor causing hesitation in buyers and sellers.

August also saw flat demand from new buyers in Yorkshire and Humber, and 23% of agents in the region reported a fall in newly agreed sales.

Meanwhile, a lack of new instructions to sell is still proving a long-standing issue, with few fresh listings coming onto the market, resulting in dwindling stock levels.

These downcast trends over the past month have ensured price pressures remain unchanged, with 22% of agents in the region reporting a rise in house prices last month (up from 14% in July) and 24% anticipating prices will continue to rise further over the coming year.

James Watts MRICS, of Robert Watts Estate Agents in Bradford, said: “Most vendors and buyers are aware of reports suggesting house prices are rising in Yorkshire and Humber, however many people are still cautious with the ongoing uncertainty on Brexit.”

In the lettings market, the August results show that 21% of respondents reported a rise in tenant demand (non-seasonally adjusted figures) up from 18%.

However, landlord instructions remain in decline. Given the consistent imbalance between rising demand and falling supply, rents are seen being squeezed higher over the next three months.

Simon Rubinsohn, RICS Chief Economist, said: “Uncertainty is a theme that respondents continue to highlight as a negative influence on sentiment in survey after survey.

“That said, the key RICS activity indicators have remained relatively resilient until now, pointing to only a modest dip in sales transactions rather than anything more severe.

“More ominously, the August RICS results again draw attention to the challenge in the lettings market, with feedback continuing to indicate that demand is outstripping supply. As a result, the pressure is for rents to continue moving higher and indeed outstripping any price gains both in the near and medium term.”

Hew Edgar, RICS Head of UK Government Relations and City added: “The ever-changing policy landscape is damaging confidence in the lettings market.

“But the Private Rented Sector (PRS) has the enormous potential to deliver more homes that are urgently needed, and to contribute to the alleviation of the affordability issues which are being exacerbated by the ongoing dearth of supply across all tenures.

“The need for the regulation of property agents – including those operating in the PRS – is critical in order to make the sector more attractive to landlords, and of equal importance, enhance the landlord-tenant relationship.

“To assist this recommended regulation, we are working with industry to develop an approved PRS Code of Practice.

“We have also worked with Lord Best as part of his Regulation of Property Agents (ROPA) working group, to help bring positive change and increase public confidence in the sector; parts of which have been likened to the ‘wild west.”