U.K. Home Sales Resume During Brexit Intermission
The rain check on Brexit until Oct. 31 appears to be paying off for the U.K. housing market, where the slowed down due to the political uncertainty reversed course in June.
Last month, a broad measure of U.K. home sales rose for the first time in over two years, according to a monthly survey from the Royal Institute of Chartered Surveyors published on Thursday. The effect of daily political wrangling over Brexit, which scared off house hunters and discouraged sellers earlier this year, appears to have abated in recent months, according to the survey of more than 300 real estate professionals.
A majority of property agents who responded to the survey said there was an increase in the number of sales agreed to in June. Those pending sales saw a pronounced uptick in England’s North West, Scotland and the South West, agents reported.
“New sales agreed have increased for the second month in a row providing some encouragement in the tough market,” wrote David Boyden of property management service Boydens in England’s South East, an area hit particularly hard by the housing slowdown.
The number of house hunters also rose in June, a majority of agents reported, the first time that measure of buyer interest has risen since 2016.
The market stability follows several months of positive sales trends in the country’s luxury segment, which can act as a leading indicator of future market conditions.
For instance, new buyer inquiries have risen substantially in London over the last three months, according to survey respondents, some of whom have seen an uptick in U.S. dollar-based buyers.
“Much interest in new-build purchase is driven from foreign investors in our areas,” wrote an agent with Colet Estates in the prime central London.
Despite the positive indicators, Brexit remains a top concern for the buyers and sellers moving forward, agents reported.
"The latest data provides further evidence of the sales market settling down,” said Simon Rubinsohn, chief economist at RICS, in commentary. “But I don't get the impression from the insight provided by contributors that this is fueling hope of a significantly more active market going forward. Many of the factors that have provided a challenge during the first half of the year remain unresolved.”