April RICS report shows demand and sales stabilise

April RICS report shows demand and sales stabilise

April saw agreed sales and new buyer enquiries stabilise following the decline over recent months.

The April 2018 RICS Residential Survey painted a steadier sales activity picture across the UK, particularly when headline indicators are compared with those recorded over the last few months. It is important to look at the figures on a regional basis, however, with Southern areas continuing to show weakness. Though national readings on the near term look predominantly flat, the long-term expectations signal a potential uplift on the 12-month horizon.

The latest results show that the RICS Price Balance fell to -8%, signifying the weakest reading since November 2012. Looking at the figure comparatively, however, the drop is a marginal decline in prices at this point.  London continues to put pressure on the national reading, with a net balance of -65% of respondents citing lower prices observed over April. Those in the South East reported along the same lines, with the net balance here turning modestly negative for the first time in five years. Given the marginal nature of this fall, it is uncertain whether or not this signals the start of a fall in the long term. At the other end of the spectrum, Northern Ireland and Scotland both saw house price inflation remain strong.

Looking at the short-term outlook, prices remain relatively steady on a national basis, with falls in some areas offsetting the small uplifts in others. Moving to the longer term, the outlook is rosier, with a net balance of 31% of contributors anticipating a rise in prices over the next 12 months. This positive sentiment was reflected across most areas of the UK, with it being most strongly felt in the North West of England and Scotland. Whilst London, on the other hand, didn’t mirror this positivity, the reading of -200% was the least negative since June last year.

Where sales were concerned, the feedback indicates that the middle and upper priced tiers of the market were the most difficult. For example, for properties valued at £1 million or over, 69% of respondents stated that the sales price was below the asking price. The tier below is similarly showing signs of this trend, with just under three-quarters of contributors stating that on properties valued between £500,000 and £1 million, the price sold for was less than the price it was listed at.

Moving on to new buyer enquiries, whilst the trend has remained relatively steady throughout April, the figures show that demand has not given a positive reading for thirteen months in a row. The fall for new instructions is also ongoing, though the -7% net balance is the least negative figure since September 2017. In line with this, levels of supply similarly remain steady at an average of 42.2 properties on estate agents’ books.

Though agreed sales also remained relatively unchanged over April, the regional picture is varied. Of the twelve regions and counties which the survey covers, just four saw a meaningful rise. Taking a break from its usual position, London was one of these areas, with +10% of respondents observing an uplift.

At a national level, expectations for sales over the next three months paint a fairly flat picture, with a modest increase in positivity where the 12-month forecast is concerned.

The full report can be accessed here.

Georgia Owen

Georgia is the Content Executive and will be your primary contact when submitting your latest news. While studying for an LLB at the University of Liverpool, Georgia gained experience working within retail, as well as social media management. She later went on to work for a local newspaper, before starting at Today’s Conveyancer.

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