Housing market set for post-election revival – RICS
A poll found that property surveyors expect a recovery in sales activity in the UK housing market following the general election and the predicted fall in mortgage rates.
The Royal Institution of Chartered Surveyors’ (RICS’) June UK residential survey showed that respondents returned a net balance of +20 for sales activity over the next three months.
RICS said this indicated confidence in the newly elected Labour government, which has pledged to build 1.5 million homes over the next five years.
This was up from a reading of +10 last month for near-term expectations and was the most positive sentiment for sales since January 2022.
Looking at price expectations over the next twelve months, a net balance of +54 of respondents believe prices will continue to rise, highlighting a key challenge for the new government as boosting housing supply in the UK will not be an easy task. However, any boost to confidence from aspects such as the possibility of lower interest rates should in theory intensify the nation-wide affordability challenge.
Tarrant Parsons, senior economist at RICS, said: “Although activity across the housing market remained subdued last month, forward-looking aspects did improve slightly.
“There are some factors emerging now that could support a recovery in the months ahead. If the Bank of England does decide that the current inflation backdrop is benign enough to start loosening monetary policy next month, this may prompt a further softening in lending rates. In addition, the recent election delivered a clear outcome, with housing pushed up the political agenda.”
Mortgage lenders lowering rates
Mortgage lenders have been reducing their rates recently. Barclays has launched leading two and five-year fixed rates targeting homebuyers looking to borrow up to £2 million.
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The information contained within was correct at the time of publication but is subject to change.
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