SCOTLAND & NORTHERN IRELAND CONTINUE TO OUTPERFORM
• Sales edge up for the second consecutive month
• Rental market remains firm with supply conditions tight
• Balanced national picture hides regional disparities
The RICS Residential Market Survey for January shows a relatively stable picture at the national level but with demand and supply conditions varying somewhat across different parts of the UK. London is still the only area where more respondents are reporting falling rather than rising prices. In contrast, Northern Ireland witnessed the strongest price growth for the fifth consecutive month with a balance of 47% of respondents reporting rising prices; Scotland followed close behind with a net balance of 38%.
The RICS new buyer enquiries series recorded it’s seventh consecutive negative reading in January. The contraction in demand appears minimal and continues to mask a very mixed picture across different parts of the UK. Anecdotal evidence from respondents suggests that a multitude of factors are impacting different markets with political uncertainty weighing to some extent on all parts, while the stamp duty reforms are already providing a boost in areas such as the South West and Scotland. Meanwhile, on the supply side of the market the situation looks broadly unchanged over the month. However, conditions are equally disparate across areas with the market remaining tight in the North West and South East, while in the South West more properties have come to market in recent months.
Reflecting the relatively more stable demand picture and undoubtedly helped by the greater competition from lenders, which has seen mortgage rates fall in recent months, the RICS agreed sales balance showed a modest increase in January with more areas now seeing some improvement than at any time since mid-2014. Near-term sales expectations have moderated slightly with a net balance of 10% of respondents now envisaging an increase over the coming three months, from 19%
previously. However, at the twelve month horizon respondents remain more optimistic that activity levels will increase, with an unchanged balance of 48% of surveyors still expecting sales to rise. The London market is the outlier in terms of pricing with the net balance recording its fifth consecutive negative value and falling to a six year low in January. Near term price expectations for the capital have also deteriorated with a balance of 24% now envisaging prices falling further over the coming three months, while at the headline national level prices are expected to remain broadly stable. However, at the twelve month horizon sentiment remains positive across all areas including London with respondents, on average, expecting to see a rise of 1.8% over the year to come. Meanwhile, over the course of the next five years, the average of surveyors’ forecasts indicates annual growth in the region of 4% per annum.
A very busy start to the New Year with a high level of viewings, increased numbers of market appraisals and new instructions. Sales also on the increase particularly over £500,000. Flats need to be competitively priced due to the large numbers available.
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