Home    Estate agents eye better times in 2020

UK estate agents have started the new year on a bright note with buyers, sales and price expectations at their highest level for 3 years.

According to the December monthly survey by the Royal Institution of Chartered Surveyors, published on Thursday, inquiries by new buyers, the number of agreed sales and price expectations all saw marked improvements.

The greater degree of political certainty provided by Boris Johnson’s emphatic victory in last month’s general election and low mortgage rates both contributed to the more positive picture, analysts said. The property market has significantly slowed since the Brexit referendum in June 2016.

According to the post-election survey, 17 per cent more Rics members reported a rise in new buyer inquiries compared with those reporting a fall — the highest level since the start of 2016 and up from minus 5 per cent in November. It was a similar story with agreed house sales, with the proportion of surveyors reporting an increase, rather than a decline, at its highest level since February 2016.

“The signals from the latest Rics survey provide further evidence that the housing market is seeing some benefit from the greater clarity provided by the decisive election outcome,” said Simon Rubinsohn, Rics chief economist.

The outlook for sales and prices over the coming 12 months is even brighter, according the survey, with 66 per cent more respondents saying they expect sales to rise.

“The election result has finally shaken Britain out of its paralysing political uncertainty, giving the property market a renewed clarity and sense of purpose,” said Jonathan Hopper, managing director of Garrington Property Finders. 

However, others economists are more cautious, partially due to high prices relative to earnings, particularly in London, and weakened economic growth. 

The Rics survey showed a growing expectation in London that house prices would rise in the next three months.

Because house prices in the capital city remain high relative to earnings, the rising prices expectation “is a concern”, said Mr Rubinsohn, highlighting the “critical importance of the government addressing the challenge around housing supply”.

The Rics figures were published hours after official government data showed UK house price growth accelerating to 2.2 per cent in November, up from 1.3 per cent the previous month.

“The economy still looks set for a pretty challenging 2020 and there will still be appreciable uncertainties, including on the UK-EU relationship front — so the upside for house prices in 2020 is likely to be limited,” said Howard Archer, chief economic adviser at the consultancy EY Item Club. 

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