The uncertainty in Brexit and the lack of affordability in some areas continue to affect the UK real estate market, leaving UK real estate agents with their bleak view of real estate for ten years.
The recent monthly snapshot of the Royal Institution of Chartered Surveyors (RICS) shows a further weakening of the market as demand, prices and sales expectations are pointing downwards.
The industry survey came when the latest government figures showed that house price growth across the UK had slowed to its lowest rate since July 2013. Average prices increased in December by 2.5% compared to December (2.7% in November). National Statistics statistics also indicated that the weakening of the housing market from London and the southeast could spread to other regions.
December saw a 1% drop in the price of the North East compared to a rise of 1.7% in November, while London prices fell 0.6% over the year. The average UK home price in December was £ 231,000, £ 6,000 higher than 12 months earlier.
Rics' house price record, which measures the difference between the number of real estate agents and real estate surveyors looking to increase and those expecting a decline, fell to -22% in January, its lowest level since March 2009.
The most negative responses to the survey continued to come from London and the Southeast, followed by East Anglia and the Southwest. These regions have experienced strong price growth over the last six years, which has extended affordability, and high prices are a crucial factor deterring potential buyers, Rics said.
The agreed trade balance, a measure of expected transaction volume, deteriorated to -25, the lowest level since October 2017, while the net sales balance for the next three months is at its lowest level since the 1999 survey and – 32% of -28 %.
Rics' price level has been negative or flat since July 2017, while sales expectations have been negative since August 2018.
Surveyors and real estate agents, however, have become more optimistic about prices and sales over the next 12 months since December. Property values continue to rise in Northern Ireland and Scotland. They have the highest price expectations for the coming year, followed by Northwest and Wales. In London, however, they expect falling prices.
Mark Zorab of Elston's estate agents in Chepstow, who participated in the Rics survey, said: "Fifty percent of [the] general public [is] Waiting for the result of Brexit. The other 50% like to buy, but only for the right price. "
Savills' Darlington Simon Bainbridge said that despite the Brexit uncertainty, there were plenty of positive things to do, even though "there are potential buyers who openly admit that they are waiting for the Brexit result".
In virtually all parts of the UK, demand weakened somewhat, with the exception of Scotland, where it remained unchanged. The balance of buyer inquiries fell to its lowest level since June 2008 from -18% to -35%.
The real estate flows entering the market also decreased. The lowest level of -25% was the lowest level since July 2016, the month after the EU referendum.
The average time it takes to sell a property from listing to completion has reached 19.4 weeks, the longest since it was introduced in 2017.
David Knights of David Brown & Co in Ipswich said: "In January, a good number of visits and offers were expected to hit the normal" bounce "market. However, this did not hold back to the resumption of Brexit negotiations witnessed a slowdown in the last 10 days of the month. "