Brexit uncertainty is hitting the market across all price points, while there are warnings that agents can expect no improvement in the New Year.
The RICS today said that Brexit uncertainty meant new instructions last month were the lowest for almost two-and-a-half years.
Average stock levels on estate agents’ books remained close to record lows at 42.1, says the report which was compiled before the political drama of the last few days including last night’s confidence vote in prime minister Theresa May.
The report says that more RICS estate agents are already reporting declining sales, and are expecting further declines over the next three months.
Hew Edgar, head of policy for RICS, said that before the EU referendum in 2016, its research indicated that Brexit would only impact the higher end of the residential market.
He said: “Now, however, it appears that those looking to buy and sell homes across the price spectrum, as well as those looking to invest in the UK’s residential sector, are putting off decisions until there is more certainty.”
Simon Rubinsohn, chief economist for RICS, said he cannot recall a previous survey when a single issue has been highlighted by quite so many agents.
He added: “Caution is visible among both buyers and vendors, and where deals are being done, they are taking longer to get over the line.
“Significantly the forward-looking indicators reflect the suspicion that the political machinations are unlikely to be resolved any time soon.”
This outlook is shared elsewhere.
Nick Leeming, chairman of Jackson Stops, said that political uncertainties would mean a “very” slow start to the New Year.
He said that with every minute that passes waiting for a Brexit outcome, confidence is declining.
Analysis of agency listings by property website Home.co.uk shows that 10% more properties have had their prices cut than a year ago.
A poll by NAEA Propertymark, conducted last month, found that 46% of members believe a no-deal Brexit would have a negative impact on the market, while 62% think home owners will put off plans to move due to the uncertainty.
As a result, almost half (43%) expect house prices to fall next year.
While 39% of agent members think supply will increase, 35% think demand will drop.
Meanwhile, data from banking trade body UK Finance shows the number of remortgage approvals in October was up 23.2% annually and at the highest level for almost a decade – suggesting that at least some home owners may prefer to improve rather than move.
However, there were 32,900 first-time buyer mortgages completed in the month, up 8.2% annually, while the number of home mover mortgages grew 4% to 33,400 over the same period.