Housing market gains momentum in July, RICS survey finds

The housing market gained momentum in July as its recovery continued, according to July’s RICS UK Residential Survey.

The housing expert suggested the stamp duty holiday, introduced from 8 July, is playing a significant role in lifting demand.

However, respondents to the RICS survey also indicated they do not expect this impetus to continue as wider government support measures begin to be phased out later in the year.

As new buyers flooded into the market, RICS revealed that a headline net balance of +75% of survey participants noted an increase over the month, marking the second consecutive report in which demand has rebounded firmly. New instructions being listed onto the sales market also rose sharply, evidenced by a net balance of +59% of respondents reporting a rise – a level up from a reading of +41% in June.

Looking ahead, the survey indicated that continued growth in sales at the headline level over the next three months is expected, with a net balance of +26% of contributors anticipating an increase.

However, twelve-month sales projections remain negative, with RICS reporting that a net balance of -10% of respondents foresee sales tailing off over the year ahead – amid concerns about the prospects for the UK economy and the impact this will have on employment as the furlough scheme expires in October.

RICS chief economist, Simon Rubinsohn, commented: “The strong impetus provided to the housing market is evident both in the results of the RICS survey and many of the anecdotal comments from respondents.

“However, it is interesting that there remains rather more caution about the medium-term outlook with the macro environment, job losses and the ending or tapering of government support measures for the sector expected to take their toll. Significantly, some contributors are now even referencing the possibility of a boom followed by a bust.

“Meanwhile one of the other notable aspects of the survey is the feedback that there is a greater interest in properties that offer some features that help better manage future lockdowns whether it is access to green spaces, gardens or balconies.”

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