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Summer housing boom may not last, warn surveyors

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  • 13/08/2020
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Summer housing boom may not last, warn surveyors
Housing market activity picked up in July as the stamp duty cut boosted demand but surveyors are uncertain how long the summer boom will last.

 

The stamp duty holiday played a significant role in lifting homebuyer demand, according to the Royal Institution of Chartered Surveyors (RICS) July market report.

Surveyor responses are measured on a net balance of 100 per cent to –100 per cent depending on whether respondents report increases or decreases. 

New buyer enquiries were up on the previous month, rising from a net balance of 61 in June to 75 in July. 

Agreed sales also increased from 43 in June to a net balance of 57 in July.

Meanwhile 57 per cent of surveyors said they had seen growth in new valuation instructions, up from 41 per cent in June. 

An increase in house prices was reported by 12 per cent of respondents during July, a notable change from June’s -13 per cent. 

Over the next 12 months, eight per cent of respondents expect prices to rise.

Despite the strength of the summer market, RICS said some surveyors had suggested the housing market would experience a “boom followed by a bust”.

Some 26 per cent of valuers said they expected a growth in sales over the next three months, however, 10 per cent predict sales “tailing off” over the next year once the furlough scheme ends in October and the stamp duty holiday expires in March. 

Simon Rubinsohn, chief economist at RICS, said: “The strong impetus provided to the housing market is evident both in the results of the RICS survey and many of the anecdotal comments from respondents.  

“However, it is interesting that there remains rather more caution about the medium-term outlook with the macro environment, job losses and the ending or tapering of government support measures for the sector expected to take their toll.” 

 

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