Monday, 23 September 2019

Shortage of homes coming on the market

A SURVEY by the Residential Market Survey from The Royal Institute of Chartered Surveyors in July has revealed a rise in buyer enquiries in London’s housing market, although sales and price expectations continued to fall.

The region’s lettings market has also seen an increase in tenant demand, despite a fall in the number of homes available for rent.

As the new Government seems to be concentrating on increasing home ownership, falling supply in the lettings market seems likely to push rents even higher in London.

Tenant demand in the capital is at its highest level since January 2015, with 27 per cent of agents in the region reporting a rise, while 18 per cent reported a fall in rental properties coming on to the market last month.

There has been a rise in enquiries from new London buyers in July, for the second month running — a trend that is mirrored across most UK regions — although the number of new instructions to sell decreased.

It appears that in London, as well as on a national level, there is little prospect of a sustained rise in supply coming on to the market in the immediate future.

House prices continued to drop in London, the South East and East Anglia in the last month, whereas house prices in Northern Ireland, Scotland and Wales are still rising at a solid pace.

Simon Rubinsohn, RICS chief economist, said: “The latest results will provide little comfort for the market with all the key indicators pretty much flatlining.

“Indeed, the forward-looking metrics on prices and sales also seem to be losing momentum, as concerns about Brexit and political uncertainty heighten.

“Some support may be provided by an easing in the cost of money, which could feed through into lower mortgage finance costs, but this may be insufficient to provide a spur to lift activity given the clouds hanging over the economy.

“Meanwhile, the lettings market data continues to send a very strong message that institutions need to upscale their build-to-rent pipeline, to address the shortfall resulting from the decline in appetite from buy-to-let investors.”

Property

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