A shortage of supply in both the lettings and sales segments continue to present a huge challenge for the market.
The results of the January 2017 RICS UK Residential Market Survey again point to a sales market that is lacking momentum, with transaction volumes and
enquiries both seeing relatively little change over the month (on a seasonally adjusted basis). Meanwhile, a shortage of supply remains a challenge in the lettings
market - an issue that could worsen over the medium term - as respondents expect landlords to decrease their portfolios over the next three years.
Starting with the sales market, new buyer enquiries were more or less unchanged during January, with a net balance of only 5% of surveyors reporting an increase in
demand (the softest reading since August 2016). Having held broadly steady over the past three reports, the flow of fresh sales listings coming to market deteriorated
over the period. As such, the national new instructions indicator has now failed to post a positive in reading in eleven consecutive months. This has ensured average
stock levels on agent’s books remain close to historic lows.
With regards to the rental market, the (seasonally adjusted) data shows the flow of new landlord instructions failed to improve for a fourth consecutive quarter. Furthermore, the lack of listings coming to the lettings market may become an even greater issue ahead, with changes to Stamp Duty, alongside scheduled cuts to mortgage interest tax relief, both seen as important factors diminishing the attractiveness of buy-to-let as an investment.
Full Report: RICS UK January Residential Survey