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The Masked Tulip

Rics Welsh Housing Market Survey, July 2009

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Confidence improves but Wales still has further to go

RICS UK housing market survey, July 2009

There were some signs of improvement in the Welsh housing market in July but there is still a long way to go, according to the latest RICS UK housing market survey published today (11 August 2009).

While chartered surveyors across Wales reported improved confidence in price expectations, with the net balance of chartered surveyors expecting a rise rather than a fall in house prices over the next three months increasing to 0 from -6%, the reality of prices seemed less positive with the net balance of surveyors reporting falling rather than rising prices increasing to -45% from -20% over the past three months. These are some of the weakest net price balances in the UK.

However, the average number of transactions per surveyor in Wales did improve from 12 a month to 14 a month.

Across the UK, there was a more positive outlook as sentiment in the housing market continues to improve. Significantly, 8 percent more UK chartered surveyors expect prices to rise rather than fall over the next three months, the highest reading for this series since April 2007.

The improved optimism for prices can at least partly be attributed to the fact that increased interest from new buyers has not been matched by supply coming onto the market. New buyer enquiries remained high in July with a net balance of 63 percent reporting a rise rather than a fall; this is marginally lower than the previous month but still indicative of a growing level of interest in the market. At the same time the levels of stock on estate agents books remains very low.

In July more Chartered Surveyors reported an increase than a decrease in the number of new instructions for the first time since May 2007. However the positive net balance of just 2 percent suggests that vendors are still a little reluctant to put properties on the market.

Housing market activity, in terms of actual transactions, also continued to rise during July. The monthly increase in the agreed sales net balance pushed that measure to its best level in a decade. That is consistent with the further improvements in the average sales per surveyor series. On average, surveyors sold 15 properties over the past three months compared with the previous reading of 13. As a result the sales-to-stock ratio (a measure of market tightness) increased slightly to 25, supporting the argument that the imbalance in stock levels is still providing support for prices.

The regional picture highlights the north / south divide developing in the English market. The sales-to-stock ratio is highest in London and the South East and lowest in the North. Correspondingly, the net balance of surveyors reporting price rises in London and the South East are 31 percent and 2 percent respectively, whereas 23 percent more surveyors in the north are still reporting prices falling rather than rising.

Commenting on the Wales figures, Kelvin Francis, director at Kelvin Francis estate agents, said: “Our own experience has been in line with the main part of the UK. The number of our sales agreed - and more importantly, contracts exchanged - has been gradually improving. Our stock levels have not appreciably diminished, so the immediate future is looking good.

“However, Wales is almost a microcosm of England, in that it is in the main urbanised areas of the North and South where most of the commercial activity and therefore the employment is, whilst most parts in between are still suffering. The country taken as a whole therefore, shows a lower average figure, but I would be inclined to take our lessons on the market mainly from the main centres. The activity will work outwards from there, although it may be some time before Mid Wales and parts of West and North Wales catch up.â€

Commenting, RICS spokesperson Jeremy Leaf said:

“Although demand for property is continuing to rebound, it still remains low from a historical perspective. Crucially it is the lack of supply that is helping to underpin prices at the present time.

“Significantly, the more positive news on prices - at least in some parts of the country - may prompt more properties to come on to the market. If mortgage availability remains insufficient to meet the increase in buyer demand, then it is possible that prices may slip back again especially if unemployment continues to rise and mortgage rates increase.

“The pattern emerging in the regions is very interesting, with more Chartered Surveyors in London, the South-East and the South West reporting rising prices, whilst those in the North are clearly experiencing a very different marketplace. “



“There has been a noticeable increase in levels of enquiries and viewings. However, there is still often great disparity between offers put forward and vendors willingness to accept. Generally though there appears to be a little more optimism particularly with buyers.â€

David W. Pearse FRICS, David W Pearse & Co, Mold, Flintshire, Tel: 01352 700274

“More people looking and a little more confidence out there, but uncertainty with the prospects of "Double Dipping" likely as Government revenue shrinks further with little attempts by the Treasury to cut back spending.â€

Paul Lucas Bsc FRICS, R K Lucas & Son, Haverfordwest, Pembrokeshire, 01437 762538

“Enquiries have risen enormously, particularly with regard to new developments. Bank lending is still a problem.â€

D E Baker FRICS, David Baker & Company, Penarth, Vale of Glamorgan, 029 2070 2622

“Properties are selling as vendors realise it is all relative. More properties coming onto the market, but still very difficult, especially for first time buyers as lenders very reluctant to lend more than 70-75% of value.â€

John Caines FRICS, Payton Jewell Caines, Bridgend, Wales, 01656 654328

“There is a little more optimism in the market in the past month with achieved sales outstripping any in the previous 6 months. The level of mortgage lending needs to improve and the banks should be made to make more funds available at competitive rates.â€

Andrew Morgan FRICS, Morgan & Davies, Lampeter, Ceredigion, 01570 423623

“If the property is correctly priced then it will sell. Some vendors still 'trying the market' but without success. Cautious lending policies still affecting quality propositions slowing down the market.â€

John Nicholas MRICS, J J Morris, Haverfordwest, Pembrokeshire, 01437 760440

“Bad weather and school holidays having a negative impact; viewings quieter compared to last month. Vendors becoming more realistic in terms of asking prices. Smallholdings are selling well, being in good demand and are selling quickly when put on the market.â€

David James FRICS, James Dean,Brecon, Powys, 01874 624 757

“Can only sell properties at the right price.â€

J E Davies MRICS, BJP (Residential) Ltd, Ammanford, Carmarthenshire, 01558 822468

“More enquiries but little movement.â€

J E Davies MRICS, BJP (Residential) Ltd., Llandovery, Carmarthenshire, 01558 822468

“Slight increase to confidence.â€

Dafydd Hardy MRICS, Dafydd Hardy Y Gwerthwyr Tai, Llangefni, Ynys Mon, 01248 723322

“A great deal of activity. Increase in viewings and sales this month. Slight increase in confidence in the market.â€

Roger Davies MRICS, J J Morris, Cardigan, Ceredigion, 01239 612 343

“A continued upturn in sales negotiated in July which will hopefully move through to completion. Been more viewings this month but many people have their own homes to sell and we are waiting for buyers. A small percentage of cash buyers around are able to proceed so much quicker which is important to some vendors. Market now appears to be settling down and hopefully throughput will now increase as both vendor and purchaser now recognise realistic valuations.â€

David Jones BSc FRICS, Jones & Redfearn, Rhyl, Co Denbighshire, 01745 361111

“The market seems to have stabilised but activity is still muted. Hopefully in September the market will come back off its holiday and will be steady for the rest of 2009 until recovering in 2010.â€

If anyone can make any sense out of the above second paragraph, in red, then please translate it for me. As far as I can make out, they have put so much spin on the info that you need the intellect of Albert Einstein to understand what is being said?

I think it is, IMPO, FUD but would welcome opinions. :unsure:

Nice to see that the old EA/Surveyor trick of blaming the weather, the school holidays, etc, for a lack of interest. You know what is like people, you want to buy a house but the long Summer days of May to August are obviously not the best times to buy a house. Much better to wait till the cold, dark, grey days of the Winter! :blink:

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“There has been a noticeable increase in levels of enquiries and viewings. However, there is still often great disparity between offers put forward and vendors willingness to accept. Generally though there appears to be a little more optimism particularly with buyers.â€

My neck of the woods (ish) and I'd agree with the bolded bit. I see almost zero sales here in the price bracket we're looking at, and it's due to seller delusion.

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