UK housing market slowed at start of year – survey

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Britain’s housing market slowed at the start of the year, with new property listings, buyer enquiries and sales all falling in January, according to a survey.

The market slowed markedly despite being allowed to stay open during the country’s third national coronavirus lockdown, said the Royal Institution of Chartered Surveyors (Rics).

Its monthly survey found that a net balance of -28% of chartered surveyors reported a decline in new buyer enquiries in January, ending a seven-month run of rises and signalling a drop-off in demand. The balance refers to the proportion of respondents who reported lower enquiries minus those seeing an increase.

A net balance of -38% of surveyors noted a fall in new properties going on to the market, the first decline since May. New appraisals undertaken over the month also dropped.

Agreed sales were also down, with the balance at -18%, versus +15% reporting higher sales in December. Surveyors expect sales to fall further in the months to come.

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Ian Morton, principal at the estate agents Bradburne & Co in St Andrews, Scotland, said: “Lockdown has deterred sellers from placing their property on the market until restrictions are eased. Purchasers are window shopping during their exercise hour or online with virtual viewings but hesitant to view in person as expected.”

Despite the gloomy economic outlook, a net balance of +50% of participants reported higher property prices in January across the country, with the exception of London. In the capital, prices turned negative for the first time since July, where a net balance of -9% of respondents noted a fall in prices.

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The report is the third major survey that points to weaker activity in the property market in January. Surveys from the mortgage lenders Halifax and Nationwide Building Society showed house prices fell in January for the first time since May or June, as demand eased before the end of the stamp duty holiday on 31 March.

After the market ground to a halt during the first lockdown last spring, it bounced back strongly, fuelled by demand for bigger homes in greener locations, but is now easing.

Kirsty Keeton, a director at the estate agents Richard Watkinson & Partners in Newark, said: “Instructions have slowed which will result in lack of supply, due to high infection rates and home schooling. There is potential for a surge when lockdown eases with the spring market.”

Simon Rubinsohn, Rics chief economist, said that despite the slowdown in January, “actual transaction numbers will remain firm over the next couple of months reflecting the completion of deals that in many cases were agreed through the back end of last year. The appeal of properties with more room and outside space is, meanwhile, a theme that continues to be strongly evident in the responses to the survey.”