Home buyer demand has fallen for the seventh consecutive month in Wales, latest research has shown. The residential market survey for November from the Royal Institute of Chartered Surveys (RICS) found that the downward trend of buyer demand was continuing in the Welsh housing market.
RICS said high interest rates and a difficult macroeconomic outlook are impacting buyer sentiment which is causing activity in the market to slow.
Buyer demand has fallen for the seventh month in a row with the net balance coming in at -34%. Although less negative than the -65% reported in the previous month, the market remains in a "firmly downward trend" with indications that this will continue in the near term.
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For agreed sales, a net balance of -48% was reported indicating a continued decline in sales activity. In terms of house prices, a net balance of -28% of property professionals in Wales witnessed a fall over the month, with those on balance expecting prices to decline further.
The net balance for three-month expectations is -61% of respondents and a net balance of -50% of respondents was recorded regarding the 12-month outlook.
Anthony Filice of Kelvin Francis in Cardiff said: “As well as the seasonal slowdown, economic factors are affecting demand. Serious vendors are still listing, and buyers buying. The numbers are less but they are still taking place. Vendors are coming to terms with lower offers. Buyers are viewing more properties before deciding, indicating a more normal market.”
Chief economist Simon Rubinsohn said: “The overall tone of the latest RICS Residential Survey is understandably more downbeat than previously, reflecting the uncertain macro environment and the higher cost of mortgage finance. However, anecdotal comments from respondents capture the very real significant divergences in market behaviour at a more localised level.
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He added: “Although the headline price balance recorded two consecutive modest monthly falls in prices, and the forward-looking series indicate that this trend will extend through the coming months, the likely 'job-rich' recession suggests the downturn in the housing market this time could be shallower compared with past experiences.
"Meanwhile, the imbalance in the rental market remains significant as landlord instructions continue to fall and is consistent with further increases in rents, even if the momentum does appear to be slowing just a little.”
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