A further slowdown was evident in the housing market in Wales during August according to the latest Royal Institution of Chartered Surveyors (RICS) Residential Market Survey, with the price balance at its lowest since January 2024, and surveyors remaining cautious about the outlook.
A net balance of -24% of surveyors in Wales reported that prices fell over the past three months, after falling flat in the survey previous. This is also below the average UK net balance which sits at -19%.
Looking forward, surveyors in Wales are not optimistic on the pricing outlook as a net balance of -18% expect prices to continue declining. Although this balance is closer to the average UK net balance of -20%, and surveyor expectations for house prices in Wales are stronger over a 12-month horizon.
On the demand side, a net balance of -34% of survey respondents in Wales reported that new buyer enquiries fell through August, which is the second consecutive month this balance has been in negative territory.
And market supply levels appear more subdued too. A net balance of -23% of surveyors in Wales report that new instructions to sell fell through August, down from the -13% that was reported in July.
With demand and supply both muted, it is unsurprising to see sales levels having fallen. A net balance of -23% of Welsh surveyors reported a fall in newly agreed sales. Although remaining in negative territory, this is up from the -55% that was seen in the survey previous.
Looking forward regarding sales, a net balance of -3% of surveyors expect sales to fall over the next three months, which is up from the -10% and -28% that have been reported in the two most recent surveys.
Regarding the rental market, Welsh surveyors report that both tenant demand and landlord instructions fell flat through July. Subsequently, surveyors in Wales expect rents to be flat over the next three months.
Commenting on the sales market, Anthony Filice, FRICS of Kelvin Francis Ltd., in Cardiff, said:
“Even for the holiday season, viewing levels are quite low but viewers are serious and offer levels and sales agreed are quite strong. Transactions are slow, often due to conveyancers being on holiday, without leaving proper cover. Instruction levels are strong and should improve further in September.”
Discussing the lettings market, David James, FRICS of James Dean, Brecon cites that there is still a shortage of rentals.
Commenting on the UK picture, Tarrant Parsons, Head of Market Research and Analysis at RICS, said:
“With buyer demand easing and agreed sales in decline, the housing market is clearly feeling the effects of ongoing uncertainty. Concerns over the wider economic and fiscal outlook, combined with questions around the future path of interest rates amid stubbornly high inflation, are weighing on sentiment at this time.“
