Rics June survey has shown a significant decline in the number of new buyers as uncertainty remains after the EU referendum.
The Royal Institution of Chartered Surveyors (Rics) have said the Brexit vote in the EU referendum has caused the slowdown with a sharp fall in agreed sales and medium term price expectations slip.
Surveyors across the UK are observing greater economic and political uncertainty with 27% more saying they expected prices to fall in the coming months.
A fall in house prices would be welcomed by first time buyers giving them a chance to buy their home with a smaller deposit or lower earning requirements.
In contrast homeowners would see a decrease in equity values which could cause problems for remortgage buyers and home movers.
Supply and demand decreasing
Across the country there was a net balance of 36% of surveyors reporting a fall in buyer enquiries rather than rises, the lowest since mid-2008.
The number of properties available for sale has also decreased across the UK with 45% more surveyors seeing a decrease rather than a rise in instructions during the month.
Rics says this is the steepest fall since records began in 1998 with the combination of sluggish demand and shortage of property stock with a balance of 35% of surveyors reporting a fall in transactions for June.
Over the next three months a balance of 26% of surveyors are expecting a decrease in property sales.
Looking at the future the expectations turned negative for the first time in four years as 12% more surveyors expect fewer transactions over the next twelve months.
Fewer homes available may mean equity release mortgage buyers stay where they are rather than downsizing, by accessing money in their property to help maintain their standard of living or help your children start or expand a business.
London sees fall in buyers and prices
The more southern regions saw the sharpest contractions in demand with 58% more surveyors in London reporting a decline in buyer interest.
The lack of suitable properties on the market at an affordable price for home movers means they will remain in their current home and saving for a bigger deposit.
In East Anglia the figure was 55% and South East of England 48% experienced a decline in enquiries.
Evidence suggests the primary driver for the decline related to the EU referendum Brexit result although the higher stamp duty for buy-to-let landlords continues to weigh on demand.
There has been a significant impact on house prices where only 16% more surveyors reported prices are higher compared to 50% at the start of the year.
London is the only region in the country where the majority of respondents are seeing prices fall rather than rise in June.
Surveyors now expect house prices in the UK to rise by 14% over the next five years compared to 20% in May.
What are your next steps?
Call our LCM mortgage brokers for advice if you are a first time buyer, want to remortgage your existing home for the best mortgage deal, moving home or are a buy-to-let investor.
Learn more by using the property value tracker chart, mortgage monthly costs calculator and equity release calculator. Start with a free mortgage quote or call us and we can take your details.
For equity release buyers our London City Mortgage advisers can recommend lifetime mortgages allowing you to receive cash from your property to consolidate debt or reduce inheritance tax owed by your beneficiaries.
Use your dashboard to access online mortgage quotes, money off vouchers and start your mortgage application online 24/7 on desktop, tablet or smartphone.
