The UK housing market ended 2018 on a weak note with uncertainty still biting, alongside continuing lack of stock and affordability issues, according to the December 2018 UK Residential Market Survey
The slip continued in December with the volume of sales dwindling, although beneath this national headline some areas of the UK saw a more positive trend (East Anglia, Wales, the North East and Northern Ireland).
Over the next three months, sales expectations are now either flat or negative across the UK. The headline net balance of –28% represents the poorest reading since the series was formed in 1999.
Continually, over the next twelve-months the outlook on the subject is a much more positive, suggesting that some of the near-term pessimism is linked to the lack of clarity around what form of departure the UK might make from the EU in March.
In terms of prices, the headline indicator fell deeper into negative territory during December, to -19% from -11% in November. This marks the fourth consecutive negative reading.
As for prices, the next twelve-month outlook remains broadly flat. With the exception of London and the South East, prices are anticipated to either rise or hold steady across the other UK regions over 2019.
Simon Rubinsohn, RICS Chief Economist commented: “It is hardly a surprise with ongoing uncertainty about the path to Brexit dominating the news agenda, that even allowing for the normal patterns around the Christmas holidays, buyer interest in purchasing property in December was subdued.
“This is also very clearly reflected in a worsening trend in near term sales expectations. Looking a little further out, there is some comfort provided by the suggestion that transactions nationally should stabilise as some of the fog lifts, but that moment feels a way off for many respondents to the survey.”
Domestic issues related to lack of supply and affordability also continue to affect the market, with stock levels and buyer interest declining further in December. In fact, buyer enquiries fell for a fifth month in succession, (net balance -17% compared to -20% in November).
This decline in demand from buyers matched the deterioration in new instructions, which have now remained in negative territory for the last six months and have declined in 19 of the previous 24 months.
Given this, it is little surprise that stock levels on estate agents books remain close to record lows, currently standing at an average of just 42 properties per branch.
Furthermore, supply issues also remain evident in the lettings market, as landlord instructions also declined once again, rounding off a year in which they have fallen in all twelve months.