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According to experts, the pace of decline in property prices may slow towards the end of the year.
According to the Royal Institution of Chartered Surveyors (Rics), a net 63 percent of property professionals said house prices fell rather than rose in October, compared to 67 percent in September.
The report said the latest house price figures “suggest that the pace of decline from a national perspective has moderated in recent weeks.” Nonetheless, the house price metric remains strongly negative in most parts of the UK, too when in most cases the most recent values deviate from the lows of the last few months.”
Rics said that “contrary to the overall picture”, survey respondents continued to cite a steady rise in prices across Northern Ireland.
Sales activity remained weak, with a net 25 percent of real estate professionals reporting a decline in sales rather than an increase in October.
Sentiment suggests there is unlikely to be a significant turnaround in sales until the end of 2023, Rics said.
However, looking ahead to the next 12 months, real estate experts’ sales expectations suggest that the outlook will be more stable in the coming year, the report said.
Overall, tenant demand on the rental market continues to rise, while landlord requirements are declining.
Given this imbalance between demand and supply, survey participants predict an increase in rental prices over the next three months.
Surveyors expect rents to rise by an average of around 4% across the UK over the next 12 months.
Tarrant Parsons, senior economist at Rics, said: “Caution remains high regarding buyer and seller activity across the UK property market, although recent survey feedback suggests a slightly less negative picture than in recent months.”
More houses need to be built in the right places and more of them need to be affordable
Ric’s senior public affairs officer, Dominic Collier
“Although interest rates have now been kept on hold at the last two MPC (Bank of England Monetary Policy Committee) meetings, the Bank of England wanted to emphasize that monetary policy will remain restrictive for some time to come.
“As a result, mortgage affordability will remain tight in the near term, leaving little prospect of a strong recovery in residential sales volumes, even if expectations have now moved away from cyclical lows.”
Dominic Collier, senior public affairs officer at Rics, said: “More homes need to be built in the right places and more of them need to be affordable.”
“Existing homes need more support to improve their energy efficiency, reduce their bills and help achieve our net zero targets. We will continue to work with the government to address these challenges but also opportunities.”
The report included comments from real estate professionals.
One based in Newcastle-upon-Tyne wrote: “We need a quick and easy increase in supply, stop the sale of social housing etc.”
Mortgage affordability will remain tight in the near term, leaving little prospect of a strong recovery in residential sales volumes
Tarrant Parsons, Rics
Another from Cambridge said: “Residential property sales are very slow and no noticeable increase in activity is expected until sometime in 2024.”
A Kidderminster-based professional said: “The sales market slowed at the start of this year but demand from first-time buyers is still there. More expensive properties are selling slowly as family budgets remain tight.”
A Cardiff-based specialist said: “Suppliers are finally realizing it is now a buyer’s market and are starting to be more flexible on pricing.
“Buyers have more choice and are grabbing hard bargains or looking elsewhere. “Uncertainty over mortgage rates is still a factor, although the desire to move remains.”
An Edinburgh-based professional reported: “Fewer inquiries but buyers are still motivated. “More sales are being agreed at cheaper prices than homes, although detached houses still occasionally attract premiums.”
Commenting on the report, Sarah Coles, head of staff finance at Hargreaves Lansdown, said: “Sellers have a choice. Unless they absolutely need to move, they may want to wait — until mortgage rates come down and buyers come back. If they have to sell, they have to price their house realistically – brutally.”
Source : www.independent.co.uk