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Market remains slightly subdued

THE East Midlands’ housing market was still subdued in March, with the lack of momentum likely to continue, according to the latest RICS UK Residential Market Survey.

In March, enquiries from new buyers saw the twelfth negative reading in a row, with the East Midlands respondents reporting the longest trend in the UK of seeing a fall rather than rise in buyer demand. Demand fell across all parts of the UK in March.

The ongoing decline in new instructions and new property coming on to the East Midlands market continues to fall for the eighth consecutive report. As a result, average stock levels on estate agents’ books remain low at around 48 properties per branch.

Looking at prices, minus eight per cent of respondents saw a decline rather than rise in prices across the region in March and is the third consecutive month of declining responses.

Looking at other parts of the UK, London and the South East continue to display the weakest sentiment regarding prices, with Scotland and Northern Ireland the only parts of the UK to have seen sustained price growth on a consistent basis, over the past two months.

In the lettings market, demand from tenants fell (non-seasonally adjusted data) while landlord instructions improved modestly. On the back of this, contributors still anticipate rents to grow in the coming three months, but at a more modest rate.

Simon Rubinsohn, RICS Chief Economist, said: “Brexit remains a major drag on activity in the market with anecdotal evidence pointing to potential buyers being reluctant to commit in the face of the heightened sense of uncertainty. Whether any deal provides the shift in mood music envisaged by many respondents to the survey remains to be seen but as things stand, there is little encouragement to be drawn from key RICS lead indicators. We expect transactions to decline on this basis.

“Arguably more significant still are the signs that developers are continuing to adopt a more cautious stance with the trend in new residential starts now flatlining. Against this backdrop, there is little possibility of delivering the uplift in supply necessary to address the ongoing housing crisis.”

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