RICS: House sales struggle to gain momentum in East Midlands

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Housing sales activity during December flattened as prices continued to rise across the region, according to the Royal Institution of Chartered Surveys (RICS) Residential Market Survey.

While it remains to be seen if this is a temporary setback, 6% more chartered surveyors saw a fall rather than a rise in sales last month, and figures for predicted sales over the next three months across the region also saw a noticeable slow down with only 6% more respondents anticipating an increase in sales during the coming three months, down from 31% previously.

This follows a string of reports in which confidence in the outlook improved steadily and it remains to be seen whether or not this is temporary or the onset of a weaker trend.

The flattening of sales in the near term can once again be related back to the lack of stock of surveyor’s portfolios.

New instructions once again failed to see any pick-up with 16% more chartered surveyors reporting a fall instead of a rise.

This month, it is coupled alongside a fall in new buyer enquiries.

Long term, the twelve month sales outlook for the region remains positive with 44% more contributors expecting sales to rise over the year ahead, compared with 38% in the November survey.

The East Midlands also reported one of the strongest twelve month expectations, although all regions remain in positive territory.

Looking at house prices for December, 37% more chartered surveyors reported a rise over a fall, from +35% in November.

This measure continues to suggest prices are rising relatively firmly in the region.

Twelve month expectations remain extremely strong with 71% more respondents suggesting prices will rise.

Simon Rubinsohn, RICS Chief Economist commented: “A familiar story relating to supply continues to drive both the sales and lettings markets impacting on activity, prices and rents.

“The eagerly awaited housing white paper should help to create a more positive framework for new build delivery but with the best will in the world, it is going to take time before the resulting uplift in the development pipeline begins to impact on the opportunities for either homebuyers or tenants.

“Meanwhile, the latest RICS survey provides further evidence that both price and rent pressures are continuing to spread from the more highly valued to more modestly valued parts of the market for good or ill.”