A lack of buyer demand saw the housing market in January remain subdued, a latest survey reveals.
The January 2011 Royal Institute of Chartered Surveyors (RICS) UK Housing Market survey showed seven percent more surveyors reported demand for property fell from December 2010.
The cautious nature of potential house buyers is thought to be an indication of the overall lack of confidence in the outlook of the economy, and the possibility of mortgage rate increases later in the year.
“The key indicators of market activity remained in negative territory in January, albeit a little less so than in December,” commented Ian Perry, RICS spokesperson.
“Uncertainty over the prospects for employment, alongside the shortage of mortgage finance particularly for first-time buyers continues to weigh heavily on transaction levels.”
Supply levels of new houses to the market were also negative in January - with three percent more surveyors reporting instructions fell rather than rose.
The number of newly agreed sales continued to drop at a broadly similar pace to the past few months – with actual sale transactions slipping – the average sales per surveyor was 14.6 compared to 15.2 in December – the lowest figure since June 2009.
Additionally, 31 percent more surveyors reported house prices fell rather than rose in January.
All regions of the UK continued to record negative net price balances during January, with the East Midlands reporting -59, and Yorkshire and Humberside -46 as the weakest. Although London saw price balances improve to -4 in contrast.
Price expectations in the Capital actually turned positive for the first time since mid 2010 to +1.
Those seeking new mortgages or new deals are urged to act quickly as fixed mortgage rates rise to a six month high as a rise in the base rate is threatened, Moneyfacts reported.
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