House sales are expected to slow in 2017 due to a lack of availability

8 December 2016, 07:23

House sales are expected to slow in 2017 due to a lack of availability, a report has found.

The Royal Institution of Chartered Surveyors (RICS) said activity is easing despite a reported rise in interest from potential buyers, causing an increase in house prices last month.

Tax changes are said to have hit the higher-end of the market while Christmas is expected to slow any potential sales.

Simon Rubinsohn, RICS chief economist, said: "A key issue for the housing market is the slowdown in transaction activity since the spring, which is clearly being reflected in the RICS agreed sales data as well as in official figures.

"Although there are some signs that the numbers may begin to edge upwards in the new year, the combination of macro uncertainty, the ongoing supply shortfall, with stock levels around historic lows, and the myriad of tax changes impacting on buyers suggest that any pick-up in activity will be relatively modest.

"This is significant not just for the housing market itself but also for the wider economy given how much of consumer spending is tied in with home purchases.''

House prices are expected to continue to rise over the next three months.

The monthly survey found interest from prospective buyers increased, with 21% more respondents reporting a rise in demand while a net balance of 26% of those surveyed reported price growth.

Thomas Baird, from Select Surveyors in Glasgow, said: "Increased demand due to low levels of new housing stock has seen increasing prices paid.

"Lack of stock along with the festive period approaching may result in a slowdown of survey instructions earlier than last year.''

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