Warning to UK house sellers who haven’t sold their home yet

The Royal Institution of Chartered Surveyors said its recent survey of property professionals shows that a recent recovery in buyer demand has mellowed.

UK homeowners who have yet to sell their properties this year have been cautioned as new home buyer inquiries have “flatlined” in April, following a three-month consecutive increase, according to a recent survey by the Royal Institution of Chartered Surveyors (Rics).

The survey, which polled property professionals, revealed a slight cooling off in buyer demand. In April, a net balance of 1% of respondents reported a drop in new buyer inquiries, a stark contrast to the balance of 6% reporting an increase in March.

Simon Rubinsohn, Chief Economist at Rics, attributed this shift to the market’s sensitivity to interest rates, stating, “Feedback to the latest Rics survey demonstrates the sensitivity of the sales market to interest rates at the present time, given the continuing challenge around affordability.”

Despite the current slowdown, Rubinsohn noted that there is still a strong perception among property professionals that market activity will pick up in the latter part of the year and into 2025, regardless of any political uncertainty surrounding the general election.

However, the lettings market is not without its challenges. Rubinsohn pointed out that an increasing number of respondents are drawing attention to affordability constraints, which is reflected in a more modest pace of rental growth. He also highlighted the fundamental problem of the imbalance between demand and supply, with new instructions continuing to decline.

Anna Anthony, UK financial services managing partner at EY, remarked that while the UK is hopefully beginning to see economic recovery, both households and businesses continue to face high borrowing costs, which has had a significant impact on bank lending and activity in the housing market.

“High living and lending costs have meant fewer house purchases, and although we’re starting to see signs that activity is picking up, we expect mortgage lending growth to be very low again this year,” Anthony told Birmingham Live.

Looking ahead, Anthony expressed optimism for 2025, stating, “If inflation continues to fall and interest rates are cut in the coming months as expected, we believe economic recovery and market confidence will gain momentum in 2025.” However, she also cautioned that potential risks to the downside remain very real, citing election uncertainty in the UK and US, as well as rising geopolitical tensions in the Middle East and Ukraine.

As the UK housing market navigates the challenges posed by interest rates and affordability constraints, homeowners and property professionals alike will be closely monitoring the situation, hoping for a recovery in buyer demand and a more balanced lettings market in the coming months and years.

Leave a Reply

Your email address will not be published. Required fields are marked *

You May Also Like