There has been a renewed deterioration in residential property sales expectations in the UK over the near term, with Brexit uncertainty being a significant factor, the latest market survey shows.
The Royal Institute of Chartered Surveyors (RICS) is predicting a further decline in activity over the three months to come in its August report, as both buyers and sellers remain hesitant.
Near term sales expectations fell from a net balance of -4% to -23%, representing the poorest return since February this year. Furthermore, sales expectations have weakened in almost all parts of the UK over the past two months. Things are expected to improve, albeit only very modestly, RICS adds, over a 12 month period.
As positivity has leaked out of the market, August also saw flat demand from new buyers, after a couple of months where enquiries from potential purchasers had increased somewhat.
The Newly Agreed Sales series inched slightly further into negative territory on a UK wide basis to a net balance -8% compared to -6% previously. Within this, a slightly more upbeat picture was in Wales and the North East of England.
Meanwhile, new instructions to sell were flat once again in August, marking the third consecutive report in which the volume of fresh listings coming onto the market has seen little change.
The downcast trends over the past month have ensured price pressures remain unchanged across the country as a whole. The headline RICS Price net balance came in at -4% in August, suggesting house prices were largely unchanged.
In the near term, prices are expected to fall at the national level, with a net balance of -24% of survey participants anticipating a decline over the coming three months, down from -13% previously. Nevertheless, at the 12-month time horizon, a net balance of +12% of respondents project prices will increase.
In the lettings market, the August results show tenant demand increased for an eighth month in succession, as a net balance of +23% of contributors cited a pick-up. Set against this, landlord instructions remain in decline, an ongoing trend stretching all the way back to 2016. Given the consistent imbalance between rising demand and falling supply, rents are seen being squeezed higher over the next three months.