Covid-19 restrictions are putting would-be sellers off placing their homes on the market, a survey has found.
Those considering selling property in Scotland are being deterred from doing so due to the ongoing stay at home rules put in place by the Scottish Government on Boxing Day.
That’s according to the Royal Institute of Chartered Surveyors’ (RICS) latest residential market survey for the UK.
It argues that current lockdown restrictions saw house sellers in Scotland holding off putting their homes up for sale, but predicts that sales activity will rise in the coming three months, helped by an easing in lockdown.
For the second month in a row, the number of new buyer inquiries in Scotland fell in February, with the net balance coming in at –34%. The number of properties being listed for sale also fell for the fourth consecutive month, with respondents anecdotally citing the current lockdown restrictions as the reason behind the fall in appetite.
This lack of demand from buyers and sellers led to a fall in newly agreed sales for the second month in a row, with a net balance of -34% of respondents.
The UK Residential Market Survey is used by the government, the Bank of England and other key institutions, including the IMF, as an indicator of current and future conditions in UK residential sales and lettings.
Simon Rubinsohn, RICS chief economist, added: “A very clear message emanating from the latest survey is that more needs to be done to address the shortfall in supply with price and rent expectations very evidently continuing to accelerate.
“Planning reform, which the government is addressing, alongside supporting a sustainable and inclusive recovery in the economy are key elements in encouraging the private sector to increase the pipeline of new build but it is clear that this is only part of the answer, particularly given the impact of low interest rates on demand.
“It is critical that a holistic approach is taken to the housing market ensuring that policy is designed to deliver across tenures and indeed to improve the environmental quality of the existing stock through a retrofit programme.”
The latest survey’s findings also identified that house prices are rising, with that “upward pressure” showing “no sign of easing”.
Looking at house price growth, +38% (net balance) of respondents in Scotland reported an increase in prices in February.
Those prices are expected to climb over the coming three months, too, as +17% of respondents in Scotland anticipate a rise; up from +4% in January. Scotland is also expected to see an increase in prices over the year to come.
David Cruickshank MRICS, of D M Hall LLP in Elgin said: “Few properties are being offered for sale due to Covid restrictions. Demand remains high though, resulting in short marketing periods and rising house prices.”
Near term sales expectations moved into positive territory, though, with a net balance +18% of respondents in Scotland expecting sales activity to rise in the three months ahead, marking the strongest reading since July last year.
Alexander Inglis MRICS, of Galbraith in the Scottish Borders added: “We are seeing strong demand from buyers but sellers have been reluctant to come forward due to the lockdown and time of year. This is starting to change with more sellers now ready to test the market.”
