August News: Housing Market Pauses For Breath
The UK housing market has "paused for breath", according to Simon Rubinsohn, the Chief Economist at the Royal Institute of Charted Surveyors (RICS).
Mr Rubinsohn's comment follows the publication of the RICS Residential Market Survey 2014, which the institute publishes on a monthly basis. There were 301 contributors to this month's survey, all of which Chartered Surveyors who operate in the residential sales and lettings markets.
The results of the Survey show the demand for homes across the UK fell in July, the first time that the demand in the market has headed in that direction since January 2013.
Growth in house prices may also be moderating. It is claimed that the 'rebalancing of demand and supply' has resulted in moderation of house price growth.
In July, 49 per cent of respondents to the survey reported an increase in prices, compared to 52 per cent in June and 56 per cent in May.
While there is some caution regarding the speculation, house prices are still expected to rise nationally over the next year, by 2.6 per cent over 12 months.
The picture across the country
In the survey comments, Stephen Farnsworth, a charted surveyor in Greater Manchester said:
"Position on prices is mixed with the [Buy To Let] market still able to purchase at a discount at auction. High demand property in the most desirable locations is closely linked with income level and entire streets in some areas having no agents' 'for sale' boards."
Speaking about the differences between the rest of the country and London, where demand and sales have fallen most sharply, Mr Rubinsohn said:
“The shift in the mood music amongst potential buyers in the London market has been particularly pronounced but that is in a sense consistent with the move to a more sustainable market in the capital... Elsewhere around the country, the market in general is showing a greater degree of resilience".
Mr Rubinsohn has suggested that affordability could be a contributing factor, and that most members of the survey now expect price gains to be "faster outside of the capital, than in it."
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