The Inside Edge
The Royal Institute of Chartered Surveyors, (RICS) has issued a bleak forecast for the immediate future of the property market and claims that there will be no recovery in sight while the current economic uncertainty remains.
Contrary to RICS comments, there have been reports of an increase in sales and buyer demand for November but the institution make clear that this has come on the back of a sustained period of subdued activity.
Individual surveyors showed a modest increase of 15.4 sales on average per branch as opposed to 15 a month earlier. This was the third consecutive month that figures had risen but forecasts from RICS predict a drop in sales in the very near future.
‘It is encouraging that buyer interest has edged upwards in the face of the endless diet of negative news from Europe and the turmoil in financial markets. However, a meaningful recovery still seems some way off.’ said Alan Collett, housing spokesman for RICS.
An overall picture shows that there was a small increase in house prices too with a 0.6% rise in November, compared to the previous month. However the figures still represent a 0.4% drop from the same point last year.
Regionally, those figures varied and while increases were recorded in London for example, a drop was reported for England as a whole.
As for the reasons behind the gloomy outlook, RICS has pointed to an uncertain economic future as the main reason why a sustained period of housing market growth seems unlikely for the time being at least.
In a survey at RICS, their surveyors were asked to identify all the reasons they felt were culpable in keeping the market in check. By far the largest culprit was the economy, where 89% of all surveyors felt that this was a significant factor.
Elsewhere, 70% of those surveyed blamed the current availability of mortgages while 42% pointed to the fear of house price falls as a reason for the present stagnation of the market as a whole.
The news coming out of these figures can be summed up by the quote given by Alan Collett: On the one hand there is some encouragement and relief to find an upturn in the gloom but this is fully tempered by the overall picture.
A steady, significant rise in the housing market could be a long way off and it seems that economic uncertainty has to be addressed before any remaining issues are taken into account.