- Buyer numbers dropped for the third consecutive month, and agreed sales fell again. The number of new sellers also declined, after rising for six months.
- House prices fell – with particularly poor performances in East Anglia, the South East and South West of England.
- But agents are optimistic that sales will rise again over the next three months – the most hopeful they have been since January 2022.
- They also think recent falls in house prices will slow, and that prices will rise in the coming year.
- Landlord numbers fell again, while the number of tenants keeps rising – and agents expect rents to increase.
RICS has released its Residential Market Survey for June under embargo.
Sarah Coles, head of personal finance, Hargreaves Lansdown:
“A new government has breathed a new air of optimism into the property market. Agents are hoping this means sales will pick up, and falling house prices will reverse in the year to come. It’s the most positive agents have been about sales since the start of 2022, and they’re walking to viewings with a new spring in their step. However, it remains to be seen whether buyers will share their view.
Before the election, June brought more of the bad news the market has been used to seeing – with falling sales and prices, and dwindling buyer numbers. Things were so miserable that even the number of new sellers fell back. It wasn’t helped by stubbornly high mortgage rates, with Moneyfacts figures showing the average two-year fixed rate remained just shy of 6% for most of the month.
July may hold more hope, in part because of the election result, and the arrival of a new government. This isn’t because of anything promised during the campaign. Labour didn’t pledge any particular policies to boost demand – except an extension of the mortgage guarantee scheme for those with smaller deposits. Instead, agents are holding out hope for an upswing in consumer sentiment, buoyed by the optimism that a change at the top can engender, and hope that life in general will change for the better.
We will have to see whether this materialises, and encourages more enthusiastic buyers into the market in the weeks to come. In the interim, if you’re looking to buy right now, this remains a buyers’ market, so there should be some bargains to be had. If the agents are right, you may need to take advantage of a relatively small window of opportunity. If optimism catches on, you’ll be competing with more buyers and hopeful sellers will hold firm on prices.
When you’re entering into negotiations in a busier market, it’s easy to get carried away. However, it’s vital you don’t overstretch yourself. As well as sticking within your budget, you also need to protect your emergency fund. You may be tempted to dip in, but when you move, emergencies are even more likely to crop up – from unexpected bills to repairs and maintenance you weren’t expecting to do. You need to keep cash to cover 3-6 months’ worth of essential expenses in a competitive easy access to cover these eventualities, however tempted you are to use it to boost your buying budget. On the plus side, at the moment, using online banks and cash savings platforms should mean you can earn up to 5% on this money, so it will still be working hard for you.”
