Transactions on hold for election

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Buyers and sellers have adopted a ‘wait and see’ attitude in the run-up to the General Election, say surveyors.

Price growth also lost momentum and is predicted to slow further over the next three months, show results of a survey last month by the Royal Institution of Chartered Surveyers (RICS).

Although a fall in property coming on to the market is a recurring theme over the past two years, anecdotal evidence from respondents suggests the drop may have been exacerbated by the General Election, as some adopt a ‘wait and see’ approach.

In May, 27% of respondents reported a fall in new buyer inquiries - compared with just 3% back in April - while 47% cited a decline in fresh listings. As with new sellers, a large portion of contributors suspect the General Election is having an adverse impact on demand.

At the same time, agreed sales continued to decline for the third consecutive month running. Near-term sales expectations imply little change over the coming three months, but beyond this, respondents appear more optimistic with 40% anticipating an increase in activity over the coming 12 months.

In the lettings market, 38% of contributors saw a rise in demand for rented homes last month - up from 20% back in April - but only 13% reported a rise in new landlord instructions.

Simon Rubinsohn of RICS said: “Although the latest survey suggests that uncertainty related to the General Election may have contributed to what appears to be a disappointing level of transactions in the housing market over the spring, perhaps the most ominous signal emanating from the data is that contributors still expect house prices to increase at a faster pace than wages over the medium term.

"This is despite the difficulty that many first-time buyers are clearly having in taking their first steps on to the property ladder.”

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