“Wait and see” attitude for buyers and sellers
The latest RICS (Royal Institution of Chartered Surveyors) UK Residential Market Survey indicates a decline in new buyer enquiries, new instructions and agreed sales, in May. In addition, the survey deduced that national price growth eased and is expected to slow further over the summer.
Respondents alluded to the fact that the fall in property coming to the market was likely to have been exacerbated by the forthcoming election as some chose to adopt a “wait and see” approach. At a national level, new buyer enquiries fell, following a six-month period of stagnancy. The majority of respondents to the survey believe the election was adversely impacting demand.
Over the medium term, contributors still expect house prices to increase at a quicker pace than wages, not good news for any first-time buyers who may be struggling to get a foothold on the property ladder.
What next for residential property post-election?
Like all markets, the residential property market abhors uncertainty. Rather than a serene finale to the general election, the lack of a conclusive result means we have the reverse scenario.
Immediately following the election results, the Chairman of estate agent Jackson-Stops & Staff, Nick Leeming, was quoted as saying: “The UK was promised a period of stability but today’s announcement provides anything but at this stage…” He went on to add: “The housing market has already been the recipient of doom and gloom in the news this week and certainty is now required to inject confidence and increase fluidity across all levels.”
Following the election, Lewis Johnston, the Parliamentary Affairs Manager at RICS outlined the importance of the new government in refocusing on property and to: “put housing, infrastructure investment and the regional growth agenda at the heart of its programme.” He noted that Gavin Barwell, the Housing and Planning Minister, was amongst the Tory ministers who lost their seats, the fifth politician to hold the post in under five years. Lewis commented that Barwell: “had been making headway towards developing a long-term strategy for driving up housing supply across all tenures. This vision must not be lost and the new government should stick to its plan to fix the housing market.”
Strengthening demand in Central Scotland
The central Scottish residential property market is experiencing steady growth and continues to attract second home owners and downsizers from outside the region, according to the Savills Summer 2017 ‘Market in Minutes’ research on the region. Despite insignificant property value growth, the increase in the amount of transactions indicates a strengthening market in areas such as Fife, Perthshire, Sterlingshire and Clackmannanshire; the latter has experienced an annual transaction growth increase of 16%.
The market has remained robust in holiday home hotspots such as St Andrews, despite the introduction of the extra 3% Land and Buildings Transaction Tax applicable on additional properties.