Property agents reported another fall in new homes being listed on the market during August as well as a drop in sales, as the stamp duty holiday continues to be tapered out.

According to findings from the latest RICS UK Residential Market Survey, new listings were down with a net balance of -37% of respondents reporting another fall – with eight of the last nine months now seeing new listings in negative territory.

Stock levels on agent’s books have therefore dropped from an average of 42 homes per branch at the start of 2021, to stand at 38 in August, getting close to near record lows.

RICS also reported that new buyer enquiries fell for a second month in a row, with a net balance of -14% respondents indicating they had seen fewer house hunters – following a -9% reading in July. Agreed sales also declined during the month – with a net balance of -18% of the survey’s respondents reporting a fall.

RICS economist, Tarrant Parsons, said that the latest evidence points to market activity “taking a breather” following the flurry of sales seen ahead of the tapered stamp duty holiday withdrawal.

“That said, while momentum has eased relative to an exceptionally strong stretch earlier in the year, there are still many factors likely to drive a solid market going forward,” Parsons said.

“Nevertheless, given the real shortfall in new listings becoming available of late, there remains strong competition amongst buyers and this is maintaining a significant degree of upward pressure on house prices. What’s more, prices are expected to continue to climb higher over the year to come, albeit the pace of increase is likely to subside somewhat in the months ahead.”

Looking ahead, RICS found that respondents were more optimistic about the market’s prospects during August, with a net balance of +4% of respondents expecting sales over the next three months to stabilise, and a net balance of +7% expecting a return to modest growth when looking over the next year.

RICS senior public affairs officer, Bradley Tully, said that over the long-term an overhaul of Stamp Duty Land Tax (SDLT) needs be delivered.

Tully added: “Earlier this year the House of Commons Treasury Select Committee recommended that reforming stamp duty should be a priority for the government in their report, ‘Tax After Coronavirus’.

“We would urge the government to undertake a full-scale review of the current stamp duty land tax system to assess future ideal outcomes in terms of factors such as revenue generation and housing market fluidity. Housing affordability for first-time buyers and key workers should remain a crucial factor when considering access to the market too.”

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