House sales fall in region as demand starts to slow Stagnating market could hit wider economy, warns RICS

MOMENTUM in the West Midlands housing market continues to slow as buyer demand fell for the seventh consecutive month, according to the latest research by industry body RICS.

Interest from would-be buyers across the region continued to wane with 34 per cent more respondents to its Residential Market Survey seeing a fall rather than rise during March.

RICS said this trend dated back to September as new instructions and newly agreed sales also remained in negative territory.

The analysis was compiled from a monthly survey of chartered surveyors who work in the residential sales and lettings markets.

The report said one of the main factors impeding demand, alongside the ongoing concerns over affordability, was the lack of fresh stock coming onto the West Midlands’ market.

In March the flow of properties slowed once again, marking the 30th consecutive month respondents reported a fall in the number of houses being put up for sale.

As such, average stock levels on estate agents’ books remains near an all-time low.

Sales also continued to fall in March, with 30 per cent more respondents reporting a fall rather than rise, extending the run of negative readings stretching back to August.

Respondents in virtually all parts of the UK noted either a flat or downward sales trend this month.

However, the average time for properties to complete in the West Midlands fell in March to an average of 14 weeks, the shortest completion process recorded for all regions in the UK.

In addition, prices in the West Midlands saw little change in March.

RICS’ chief economist Simon Rubinsohn said: “The latest RICS results provide little encouragement that the drop in housing market activity is likely to be reversed any time soon.

“Apart from the implications this has for the market itself, it also has the potential to impact the wider economy contributing to a softer trend in household spending.

“This could make Bank of England deliberations around a May hike in interest rates, which is pretty much odds-on at the moment, a little more finely balanced than would otherwise be the case.”