New buyer interest drops in London

…but changes to stamp duty for first time buyers may have positive effect

The London housing market continues to display a lack of momentum in December, with dipped buyer interest, according to the December 2017 RICS UK Residential Market Survey.

In December*, activity in the London housing market continued to drop, with 21 per cent more London respondents noting a decline in demand (as opposed to an increase) in the month of December, continuing an eight-month consecutive run of readings in negative territory. 

Furthermore, when contributors were asked (nationally) whether they have seen an increase in first time buyer enquiries following changes to Stamp Duty in the Autumn Budget, an overwhelming majority of 86 per cent across the UK as whole said they hadn’t. 

While this could be in part due to the time of year, respondents were also asked to consider the likely impact on the market over the coming months. Interestingly, while nationally, only 12 per cent felt it would result in higher overall activity, in London, 28 per cent said the changes would increase overall market activity. The results for the wider South East are closer to the national picture.

In terms of trends in December, agreed transactions fell again in London with 39 per cent more respondents reporting a decline in volumes over the month. Sales expectations are slightly negative over the coming three months in London, although while still in decline, they have moderated from November’s reading. Respondents are more optimistic over the next twelve months with London recording its first positive reading since last June.

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