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UK Homebuyer Inquiries Fall to Lowest Since Start of Pandemic

·2 min read

(Bloomberg) -- UK homebuyer inquiries fell in August to the lowest level since the start of the pandemic, reducing upward pressure on prices in a market that’s still booming.

The Royal Institution of Chartered Surveyors said estate agents it surveyed recorded the lowest level of interest from new buyers since April 2020, according to a report out Thursday. Sales and new instructions to list property for sale also fell at sharper rates than in the previous month. Prices, meanwhile, continued to grow amid a limited supply of homes.

The findings provide a forward glimpse of a slowdown in the market that so far has shaken off rising interest rates and a cost-of-living crisis to deliver record prices for homes almost every month this year. While a low inventory of properties for sale continues to support home prices in the near-term, price growth is expected to stall over the next year.

“Concerns over the economic backdrop and rising interest rates continue to take their toll,” said Tarrant Parsons, a senior economist at RICS. “Given projections for the UK economy point to a potential recession emerging towards the end of 2022, respondents envisage housing sales continuing to slip.”

The measure of buyer inquiries is more forward-looking than data from mortgage lenders Nationwide Building Society and Halifax, which both said that house prices rose last month.

RICS also said:

  • The stock of properties on agent’s books fell to a record low of 34 on average per branch

  • Sales predictions for the next three months slipped further into negative territory, and those for the year ahead were the most negative they’ve been since the series began in 2012

  • A net balance of 53% of agents reported higher prices in August, down from 62% in July but still well above the long-run average of 13%

  • London and the north of England were the only regions with increasing inquiries from potential buyers

“August tends to be a slower month as it is the main holiday period, however, we have seen steady level of offers,” said Allan Fuller, an estate agent in Putney in west London who contributed to the survey. “The autumn and winter will be testing with mortgage rates increasing and inflation out of control.”

Read more:

  • UK House Prices Rise Led By Surge in London, Halifax Says

More stories like this are available on bloomberg.com

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