RICS points to UK housing market activity softening
This morning’s RICS survey points to softening UK housing market conditions. The rush of homebuyer activity, ahead of stamp duty threshold changes due April 1st, now appears to be cooling off. A majority of estate agents reported falling new buyer enquiries (-14%), agreed sales (-13%) and 3-month sales expectations (-5%). In contrast, new instructions to sell (+12%) and appraisals (+16%) continued to expand, pointing to a loosening of supply-demand balance. Hence, the recent softening of UK house price inflation signaled by the Halifax (2.9%) and Nationwide (3.9%) indices in February is likely to continue in the coming months. That said, should the March 26th Spring Budget Statement contain sufficient spending cuts and tax rises it could persuade markets the Bank of England will have room to cut rates below 4% in 2025, potentially supporting the housing market.
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