Demand and sales volumes continue to fall Price momentum, however, remains positive Scotland enjoys a post-referendum bounce in activity The October 2014 RICS UK Residential Market Survey continues to underscore, at the national level, a modest dip in activity alongside an ongoing deceleration in house price growth. For the time being, surveyors expect the current weakening trend to be temporary; near term expectations indicate a flatter picture but medium term expectations remain fairly positive. The ‘temporary slowdown’ story also squares with the broader macro backdrop and the flat trend in new instructions, which suggest that for the time being homeowners are not, in aggregate, under any significant pressure to sell. Buyer enquiries and agreed sales continued to decline and at a faster pace than in the previous month. Falling activity is no longer just a London phenomenon; within England and Wales, buyer enquiries fell to varying degrees across all regions included in the survey with the exception of the North, while agreed sales fell in all regions except the South West and Yorkshire and Humberside. The factors behind the current weakness are familiar by now. The after effects of the introduction of the Mortgage Market Review recommendations in April continue to be felt, affordability is stretched in some parts of the country, interest rates are expected to start rising during 2015 and the risks emanating from a booming housing market have been well flagged by the likes of the Bank of England. Weaker activity levels are beginning to slow the pace of house price growth, but according to the survey, prices are still rising at the national level. Moreover, within England and Wales all regions included in the survey are still recording price growth with the exception of London, where the supply and demand dynamic that had proved such a boost during 2013 has largely gone into reverse. However, that being said, we would still caution against over interpreting the London net balance data; even now, certain micro markets in the capital are still showing a firm trend, while anecdotal evidence from respondents to the survey suggests that talk of ‘mansion tax’ is having a deleterious impact at the very top of the market. Outside of England and Wales, Scotland enjoyed a post referendum bounce in activity during October, after the market ground to a halt in September. Enquires, instructions and sales recovered strongly. Members are suggesting that the forthcoming introduction of the Land and Buildings Transaction Tax will continue to push new instructions higher in the near term. Meanwhile, the market in Northern Ireland, having been on its knees between mid-2007 and mid-2013 - is enjoying something of a renaissance at the moment; price momentum, sales and demand are still in recovery mode. Locally October showed a definite slowdown which was unusual. Enquiries & viewings were satisfactory but market appraisals & new instructions were subdued and the market will probably stay quiet until after Christmas. Threat of interest rate rises & forthcoming election are having adverse effect. Prices are remaining fairly stable, but vendors’ expectations are often still very optimistic and realistic pricing is still important. The mortgage market is still a nightmare. Please do not hesitate to contact me should you wish to discuss any matter regarding the marketing of your property. Oliver Miles FRICS FCABE RICS Registered Valuer 01929 426655