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Election Adds to Woes for Sluggish U.K. Property Market

The middle to high end of the market is suffering most from buyers’ lack of confidence.

Election Adds to Woes for Sluggish U.K. Property Market
A Purplebricks Group Plc estate agents sign advertising a property for sale is attached to a post next to a row of terraced houses in London, U.K. (Photographer: Chris Ratcliffe/Bloomberg)  

(Bloomberg) -- U.K. political uncertainty weighed on property in October, keeping both buyers and sellers away from the housing market.

Measures of newly agreed sales and buyer inquires both slid, while new instructions fell for a a fourth month, according to a report by the Royal Institution of Chartered Surveyors published Thursday. RICS’s headline index of prices remained negative, with London, the South East, East Anglia and the North East all posting declines.

“Both buyer and seller activity remains in a holding pattern, hampered by political and economic uncertainty,” said Chief Economist Simon Rubinsohn. “Given the upcoming general election next month, it appears unlikely that these trends will pick up to any meaningful extent over the remainder of this year.”

The were some glimmers of hope though, with respondents’ views on the near term sales outlook turning less pessimistic and expectations for a year ahead rising to their highest level in nine months.

Here are comments from some of the real estate agents surveyed:

Linda Gove, J & E Shepherd in St Andrews, Scotland

“Fewer properties on market. Agents confirm market has slowed down amid continued uncertainty about Brexit. However, demand remains strong for high-end property in proximity to golf courses with some exceptional prices being paid.”

Christopher Jowett, Jowett Chartered Surveyors in Yorkshire and the Humber

“Providing the economy -- national and the world -- does not go into recession before the Brexit fiasco is concluded, then latent demand can resurface, confidence can be restored, and house prices can increase steadily.”

Jeremy Leaf, Jeremy Leaf & Co in London

“We’re still suffering from a lack of stock, but valuations and sales agreed have increased, giving us added post-Brexit hope. Fewer but more serious buyers are clearly looking beyond present political and electoral uncertainty.”

Stephen Smith, Fraser Wood in the West Midlands

“Lack of quality instructions. The middle to high end of the market is suffering most from buyers’ lack of confidence. This has been a continuing theme in recent months.”

Martin Jackson, Residential Housing Limited in Manchester, North West England

“Clearly the outcome of the general election and Brexit will dictate the performance of the housing market in the short to medium term. There is pent up demand which will be released if a Brexit deal is done or Brexit is canceled.”

To contact the reporter on this story: Lucy Meakin in London at lmeakin1@bloomberg.net

To contact the editors responsible for this story: Paul Gordon at pgordon6@bloomberg.net, Brian Swint, David Goodman

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