Thinking of buying or selling a home? Activity in the property market is predicted to pick up following the General Election.
Housing market activity continued to decline in November but estate agents expect a rebound following the General Election.
Demand from potential buyers, instructions to sell and agreed sales all continued to worsen during the month, as people put major decisions on hold, according to the Royal Institution of Chartered Surveyors.
But property professionals are more upbeat about the market’s prospects in the new year, with 12-month sales expectations reaching their highest level since the early part of 2017.
Simon Rubinsohn, RICS chief economist, said: “Confidence is critical to a well-functioning housing market and whatever happens in the general election, it is important that the new government provides reassurance both over the stewardship of the economy and the ongoing challenges around Brexit.”
Why is this happening?
Markets hate uncertainty and the property market is no exception, with potential buyers currently facing a triple whammy of uncertainty over the Government, Brexit and the economy.
But the result of the General Election will not only end the political uncertainty, but it will also offer more clarity on when the UK is likely to exit the EU.
This is expected to release some pent-up demand from people who have put moving plans on hold for months or even years while they have waited to see when Brexit will happen and what impact it is likely to have on the economy.
Who does it affect?
The lack of activity in the housing market has left the average number of homes estate agents have on their books close to a record low of 41.
The situation creates a vicious circle in which existing homeowners who may be considering trading up or down the property ladder put off listing their own home due to a lack of choice for their next move, which in turn intensifies the current shortage of stock for sale.
What’s the background?
The good news is that RICS expects the situation to begin to improve going forward.
Estate agents expect sales levels to start to pick up over the coming three months, while optimism about the number of homes changing hands 12 months from now has reached its highest level for nearly three years, with a solid increase expected in all regions.
Price growth is also expected to recover across the country, with Northern Ireland and Wales seeing the strongest gains.
Top three takeaways
- Housing market activity continued to decline in November but estate agents expect a rebound following the General Election
- Demand from potential buyers, instructions to sell and agreed sales all continued to worsen as people put major decisions on hold
- Looking forward, property professionals’ 12-month sales expectations have reached their highest level since the early part of 2017