Housing Market Stagnates

The UK housing market faced a stalemate during June, as demand failed to pick up and supply of new property fell back, according to the most recent RICS UK Housing market survey.

Requirement for property showed small change in June, with new purchaser investigations recording a net balance of 0% (compared to -1% in May); indeed, demand has been broadly flat for the last six months. Chartered surveyors report that because the market remains hard to access, the only buyers who can really be considered serious are those who have already sold their property, or have a mortgage agreement in place.

New instructions, which had been stronger in April and May, dropped back to a net balance of +1% ( from +14% ) in June, suggesting that sellers are now holding off from putting their properties on the market. This was in part credited to uncertainty over the economy and a "wait and see" approach from potential vendors.

Perhaps not surprisingly, given low demand and supply, overall activity levels barely changed in June. Newly-agreed sales inched up marginally, with 6% more surveyors reporting sales rose instead of slid (from 5% more).

Meanwhile, the average number of finished sales per surveyor in the 3 months to June didn't move, staying at just 14.8. Alongside this, the average number of stocks on surveyors ' books slipped fractionally to 69.5 (from 71.7). Surveyors note that properties are still selling, but just if priced realistically.

House prices at a countrywide level continued to slide during June, with 27% more surveyors reporting price falls instead of rises - the negative net balance was little different from the previous month's reading (-28%). Looking forward, expectancies for future house prices showed a broadly similar pattern, with 27% more respondents expecting prices to fall rather than rise over the next a quarter.