SW residential sales still lack impetus despite new buyer enquiries rising
The South West housing market appears to have lost impetus, despite new buyer enquiries rising in March. The number of properties coming on to the market dropped further, and consequently respondents to the March 2017 RICS UK Residential Market Survey in the region have reduced predictions for sales growth in the year ahead.
Demand across the South West remains reasonably healthy, despite sales falling over the month, with 22% more respondents noting an increase in enquiries (as opposed to a fall).
However, supply is restricted, as new instructions to sell in the region fell noticeably with -19% more respondents seeing a fall in fresh listing rather than a rise over the month. This lack of supply appears to be dampening transactions and in March, 6% more respondents saw a fall in agreed sales rather than a rise.
The lack of supply is also continuing to underpin prices in the region, with 22% more respondents seeing a rise over the last month.
Even so prices growth in the South West does appear to be cooling and at 22%, the net balance was the weakest since September 2016.
Further ahead, sales expectations over the next 3 months were reduced with 22% more respondents predicting a rise. Moreover, expectations for year ahead sales growth were reduced in eight of the twelve UK regions/countries covered.
In the South West lettings market, tenant demand increased as 39% more respondents noted a fall on a non-seasonally adjusted basis. New landlord instructions and the imbalance between supply and demand continues to drive rents upwards. Contributors anticipate further growth in rents in virtually all areas over the next twelve months.
O F Miles FRICS of Oliver Miles, commented: “A very busy month in all areas with a lack of stock & keen demand putting pressure on prices. On line agents and others are quoting all time low commission and over pricing to obtain instructions.”
Simon Rubinsohn, RICS Chief Economist, commented: “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.”
