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New buyers are cautious leading to weaker sales outlook

Demand from new buyers nationally has weakened slightly for the second successive month, making the forward looking sales indicators also turn a little more pessimistic according to the September 2018 RICS UK Residential Market Survey. Respondents to the survey continue to cite the mixture of affordability constraints, a lack of stock, economic uncertainty and interest rate rises to be holding back activity to a certain degree.

Looking at new buyer demand, headline enquiries slipped again during September, with the net balance falling to -11%, (-9% in August). Having remained relatively stable over the four months prior, recent results appear to be pointing to a renewed decline in new buyer enquiries.

At the same time, the volume of new sales instructions coming to the market also deteriorated for a second month running. Unsurprisingly, this leaves average stock levels on estate agents’ books close to record low levels, with limited choice likely one factor hampering demand.

In another sign of a housing market struggling for momentum, the time taken to complete a sale (from initial listing) has increased to approximately 19 weeks. This represents the longest duration since the series was introduced back in February 2017, according to RICS.

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