New buyer enquiries shrank in July

According to the professional body, new buyer enquiries shrank over the month with a net balance of -9% of respondents seeing a fall, down from the +10% figure seen in June. This ended a positive four-month streak for the UK housing market. 

The number of agreed sales also reportedly took a dip, posting a net balance of -21% across the UK, with sales volumes slowing most notably in Yorkshire and the Humber, the east midlands and east Anglia.

House price growth was again influenced by the lack of properties ready for sale, with a net balance of -46% of respondents reporting a fall in new listings -  down further from the -35% figure reported in June. It’s therefore unsurprising that 78% of respondents reported house prices rising, although this is slightly down from the 82% reported over the past two months.

At the regional level, growth in house prices was seen across the UK, with the north of England, Wales and east Anglia seeing especially strong growth. On the other side of the scale, London saw more moderate feedback, however the latest net balance of 45% is still up when compared with previous results.

Additionally 66% of respondents nationally predict that prices will continue to rise over the next 12 months, up on the 56% figure recorded from June. Demand from tenants looking to rent new homes, meanwhile, remained strong for the fifth quarter in a row, with 52% reporting a rise – with all parts of the UK experiencing an increase.

Additionally, rents are - according to 50% of respondents - now expected to rise over the next three months. In particular, London rental expectations have seen a turnaround, with 47% of respondents in the capital expecting rents to increase - whereas 3% of respondents felt rents would shrink in the three months to April.

The RICS’s chief economist Simon Rubinsohn said: “Although the tapering in stamp duty is beginning to have some impact on RICS activity indicators, the overall tone to the market remains firm with the metrics capturing price expectations showing few signs of wavering.

“Significantly, a strong message from survey respondents is that buyers are continuing to place a premium on space with the prospect of a hybrid model of work being adopted by many organisations providing the opportunity for greater flexibility around location.

“This is being reflected both in the challenge some current homeowners are having in moving up the property ladder as well in stronger price expectations from the RICS survey for larger than smaller properties.”