Housing market activity stagnated in the leadup to the General Election as buyers and sellers adopted a ‘wait and see’ approach, RICS UK Residential Market Survey for May has found.
New listings fell by 25% in May, while new buyer enquiries and sales also declined.
While the market has been slower in recent months a number of contributors suggested to RICS that a pause for breath before the General Election is the reason for the slower market.
Richard Sexton, director at e.surv, said: “The market has been flatlining for a while now, particularly in London and the South East, arguably with a lack of affordable housing for first time buyers being the main catalyst for this.
“Regardless of the outcome of today’s election, whichever political party is in power has to make sure that housing is a top priority.
“The UK’s housing stock has been stagnant for too long and if more affordable homes aren’t built, things will only get worse.
“We urge the government to start working closely with the industry to give more people the opportunity to become homeowners.”
Despite the slowdown in the next five years RICS members expect house price inflation to reach 3.5% per year.
Simon Rubinsohn, RICS chief economist, said: “Perhaps the most ominous signal emanating from the data released today is that contributors still expect house prices to increase at a faster pace than wages over the medium term despite the difficulty many first time buyers are clearly having in taking their first steps onto the property ladder.
“The increasingly tight second hand market remains a cause for concern with the RICS series tracking new instructions to agents recording its fifteenth successive negative reading.
“It is hard to see this as anything other a major obstacle to the efficient functioning of the housing market.”