Brexit: Housing market picks up for first time in seven months after jitters

Surveyors predict a house price rise over the next three months as the number of homes on agents’ books remains at historic lows

The housing market may be beginning to return to normal

Demand for housing picked up in September for the first time in seven months as confidence began to recover in the wake of the Brexit vote. But conflicting data showed an alarming drop in London sales.

The Royal Institute of Chartered Surveyors (Rics) reported that the number of home buyers making enquiries in September rose for the first time since February. Rics said the “post-referendum jitters” that put people off purchases had gone but added that an extreme lack of supply was the main factor keeping prices afloat.

“The market does now appear to be settling down following the significant headwinds encountered through the spring and summer,” said Simon Rubinsohn, chief economist at Rics.

“Buyers do appear to be returning, albeit relatively slowly, but the big issue that continues to be highlighted by respondents is the lack of fresh stock on the market.”

Rics also predicted a house price rise over the next three months as the number of homes on agents’ books remains at historic lows. Record low mortgage rates of below one per cent have also helped to prop up valuations.

However, further evidence that the capital’s property market has gone into reverse emerged today, as sales of London homes under construction dropped 14 per cent in the last three months, according to research firm Molior.

London sales were down 78 per cent in the five months from April to August compared to the same period last year, preliminary Land Registry data showed.

“The data we’ve seen since Brexit raises a flag of caution for homebuilders for the future,” said Bloomberg Intelligence analyst Sonia Baldeira. “They’re still in their comfort zone because they’re sitting on good order books. But that can change in the next 18 months to two years, depending if there’s a hard or soft Brexit.”