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Buyer activity falls as Brexit weighs on market in Wales

RICS Residential Market Survey, Wales January 2019

The housing market in Wales got off to a slow start in 2019, with activity amongst buyers and sellers falling back, according to the latest RICS (Royal Institution of Chartered Surveyors) Residential Market Survey.

Whilst the headline price balance remained in positive territory last month, indicators for new buyer enquiries, newly agreed sales and instructions to sell all reduced, according to the balance of respondents.

Welsh surveyors also indicate that they expect prices and sales activity to fall over the next three months.

Respondents to the survey indicate that this is linked to nervousness related to the economic climate and Brexit.

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The main findings of the latest survey for Wales were as follows:

  • The headline price balance (i.e. the percentage of respondents who reported a rise in prices minus the percentage who reported a fall) was +28% in the latest survey, pointing to house prices having risen.
  • Meanwhile, the newly agreed sales balance was at -21%, indicating a fall in the number of new sales being agreed.
  • New buyer enquiries were down, according to the net balance of respondents (-10%).
  • The new instructions to sell balance was at -22%, suggesting that the number of new properties coming onto the market reduced.
  • The sales expectations balance, at -33%, suggests that sales activity will decrease in the three months ahead. The price expectations balance was at -7%.
  • When it comes to the 12-month outlook, the net balance of +40% of Welsh respondents expect prices to be higher than they are now in a year’s time.

 

RICS Residential Spokesperson for Wales, and Director of Kelvin Francis, Cardiff, Tony Filice FRICS, said: “There is a degree of caution in the market overall, related to Brexit. However, there are variations when it comes to different regions and property types. For instance, in our experience, activity in Cardiff, particularly for three-bed semi-detached homes remains strong. It is understandable that there would be some caution in the market in the short-term. However, surveyors do expect prices to be higher in 12-months’ time, indicating that they expect any Brexit impact on the market to be short-lived.”

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Mark Zorab of Elstons Estate Agents in Cheptsow said: “In our experience, about 50% of people are waiting to see what the Brexit outcome is. The other 50% are keen to buy but only at the right price.”

Paul Lucas, FRICS of R.K.Lucas & Son in Haverfordwest said: “One word: Brexit. The uncertainty has created enormous difficulties in the property sector.”

Roger Davies, MRICS, J J Morris in Ceredigion said: “The Brexit uncertainty created by the Westminster Government is causing a loss of confidence across the housing market. When a decision is made regardless of what it is the market will recover.”

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