Housing market at tipping point as buyers dry up

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Housing market at tipping point as buyers dry up

Tuesday 14th June 2011

The housing market appears to be at a tipping point, with sales faltering and potential buyers thin on the ground – whilst rentals flourish.

Two new surveys both tell the same story.

According to the Royal Institution of Chartered Surveyors, the traditional spring bounce has failed to materialise.

Its latest report, published this morning, says that sales in May fell back on April’s levels. In the three months to May, the average RICS estate agent sold just 14.7 properties.

The average number of properties listed climbed by 8.1% to average 71.3 per office, but new buyer inquiries slipped by 2%.

House prices barely moved, according to the RICS survey. Although surveyors reported falls outside London, the declines were within the margins of 0% to 2%.

RICS housing spokesperson Ian Perry said: “Buyer interest in purchasing property remains flat across much of the country and there is little sign of this changing any time soon. Uncertainty over the economic outlook remains as important as the availability of mortgage finance in depressing demand.

“On the other hand, the appetite to rent is continuing to grow. And, with little new supply coming on to the lettings market, the cost of renting is increasing and will continue to do so.”

In the other housing market survey, from the property portal Home, which aggregates listings from virtually every estate agency website and portal, a similar picture emerges.

It says that houses are now taking longer to sell, staying on the market an average of 109 days, while the number of properties on the market which have had their prices reduced rose to 88,815 – 34% more than in May and equating to 12% of all properties on the market.

The Home survey said that home buyers with cash or large deposits are becoming rarer, although buy-to-let investors are active.

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