January 14, 2021 12:01:00 AM
Property professionals’ expectations for house sales in the next few months are at their weakest since the initial coronavirus lockdown period, a report has found.
A net balance of 22% of professionals across the UK believe sales will be lower in three months’ time rather than higher, according to the Royal Institution of Chartered Surveyors (Rics) survey for December.
This marked the weakest reading since April 2020.
Looking further ahead, a net balance of 6% expect sales levels to be lower rather than higher in 12 months’ time.
The subdued near-term sales expectations are likely in part to reflect the renewed pressures induced by the coronavirus pandemic in recent weeks, Rics said.
Looking at the current state of the market, the report found that sales activity was continuing to increase, although the ending of a stamp duty holiday on March 31 is expected to weigh on activity going forward.
A net balance of 15% of surveyors saw an increase rather than a decrease in new buyer inquiries in December, although this was down from a balance of 26% in November.
The number of new properties being listed for sale picked up, with a net balance of 7% of professionals reporting an increase.
House prices continue to increase, with a net balance of 65% citing an increase in the latest report.
Rics said the national net balance has now remained between 61% and 65% over the past four months, signalling significant upward pressure on house prices across the UK.
It said London is the only region where house price inflation appears muted, with a net balance of 7% of surveyors there seeing price increases.
A net balance of 24% of surveyors expect house prices across the UK to be higher in 12 months’ time.
In the lettings market, a headline net balance of 15% of professionals saw tenant demand pick up during December. At the same time, landlord instructions being brought onto the rental market continued to dwindle, with a net balance of 12% of surveyors seeing a decline.
As a result, rental growth expectations for the coming three months strengthened slightly, as contributors across virtually all parts of the UK envisage rents rising over the near term. London remains a clear exception, where a net balance of 47% of participants anticipate rents declining in the three months ahead.
Simon Rubinsohn, Rics chief economist, said: “Looking beyond this immediate time horizon, the feedback from Rics members is that the uplift in prices over the past year will be sustained, for good or ill, as the macro picture gradually improves on the back of the rollout of the Covid vaccination programme.
“More significantly, private rents are envisaged to outpace price gain as supply continues to fall short of demand with anecdotal reports of landlords exiting the market.”