The housing market got off to a poor start in January according to the latest report from the Royal Institution of Chartered Surveyors, with new buyer enquiries, instructions and sales all falling.
New buyer enquiries dropped for the tenth straight month, with 11% more surveyor respondents reporting a fall than a rise.
RICS said there was “no sign of an upturn” in the number of properties being put up for sale, with 17% more respondents seeing a further decline in new instructions. The January figure for instructions was the weakest since May 2017.
Modest house price growth is likely, with 8% more respondents seeing a rise in prices, though there are significant regional variations. RICS said falling prices are being reported in London, the South East, East Anglia and the North East.
In the lettings market, RICS reported that tenant demand grew slightly in the three months to January while landlord instructions fell, prompting expectations for rent growth in the short term.
However, there are again sharp regional variations. For example, expectations are for rent falls in the capital, while the South East is also expected to see little change.
Simon Rubinsohn, chief economist at RICS, said that the lack of stock on estate agent books “continues to provide a major challenge”, noting that the number of valuations being undertaken does not suggest a pick up in new supply anytime soon.
He continued: “Divergent regional trends remain very much to the fore with the market in many parts of the country still actually behaving in a solid if unspectacular way despite the downbeat headlines.
“Affordability issues continue to play a key role in explaining this pattern with those areas where house price earnings are most stretched seeing the softest markets.”
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