‘Home buyer inquiries and sales fall' as buyers adjust to stamp duty changes
Home buyer inquiries and sales fell in April, after a stamp duty holiday expired and as economic uncertainty continued to weigh on confidence, surveyors have reported.
Stamp duty discounts became less generous for some home buyers from April 1. Stamp duty applies in England and Northern Ireland.
The Royal Institution of Chartered Surveyors (Rics) said that new buyer interest declined for the third month in a row, with a net balance of 33% of property professionals reporting a fall in inquiries rather than an increase.
This reflects growing caution from prospective buyers alongside affordability pressures and tight borrowing conditions, Rics said.
A net balance of 31% of property professionals saw a fall in sales agreed rather than a rise.
This was the weakest figure recorded since August 2023, pointing to a subdued spring market, the report said.
More positively, a net balance of 17% of surveyors expect sales to rise over the year ahead.
A net balance of 39% of professionals expect house prices to increase over the year ahead.
Looking at the lettings market, tenant demand increased in the three months to April according to the report, while a decline in new landlord instructions remained evident, suggesting that rents will rise over the next few months.
Rics chief economist Simon Rubinsohn said: 'Although geopolitical developments haven't helped the mood music in the residential market over the past month, the main reason for the dip in the key Rics sales activity metrics lies in the expiry of the stamp duty holiday at the end of March.
'Near-term expectations indicators suggest the subdued trend will persist for the next few months at least, but looking beyond this, the results are more encouraging reflecting in part the prospect of deeper interest rate cuts than previously anticipated.
'More problematic, however, is the negative feedback in the survey around supply in the rental market. With demand continuing to grow, there appears little relief in store for tenants in terms of the upward pressure on rents.'
Tom Bill, head of UK residential research at Knight Frank, said: 'Despite a predictable lull in April following the stamp duty cliff edge, demand in the UK housing market is relatively robust.
'The tariff turbulence means the Bank of England is expected to cut rates more quickly, which means more sub-4% mortgages have appeared although demand would falter if things got too bumpy.'
Jeremy Leaf, a north London estate agent, said: 'Over the past month or so, we have noticed considerably more tenant interest but a resistance to paying higher rents.
'However, lack of supply, particularly of one and two bedroom flats in more popular areas, often prompted by landlords deciding not to renew, is preventing a more marked downturn in values.'
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Daily Mail
24 minutes ago
- Daily Mail
BREAKING NEWS Blow for Rachel Reeves as unemployment creeps up and wage growth slows on the eve of Chancellor's spending review
The rate of UK unemployment increased to 4.6 per cent in the three months to April, from 4.5 per cent in the three months to March, the Office for National Statistics said today. Meanwhile UK average regular earnings growth decreased to 5.2 per cent in the three months to April and was 2.1 per cent higher after taking Consumer Prices Index inflation into account. It comes ahead of Chancellor Rachel Reeves announcing the Government's latest spending review tomorrow. More to follow This graph shows the average weekly earnings annual growth rates, seasonally adjusted, from 2001 to present. The latest growth rate decreased to 5.2 per cent in the three months to April
The Guardian
27 minutes ago
- The Guardian
US-China trade talks to resume; UK jobs market ‘weakening' as payrolls tumble
Update: Date: Title: Introduction: US-China trade talks resume in London Content: Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy. Trade talks between the US and China are set to resume in London today, as officials push for a breakthrough over shipments of technology and rare earth elements. After more than six hours of talks on Monday, negotations will resume at Lancaster House later this morning. Investors are hopeful of a breakthrough that could continue to ease tensions between the two economic superpowers. President Donald Trump has indicated that the first day of talks were encouraging. He told reporters that 'We are doing well with China. China's not easy….I'm only getting good reports.' The US are unhappy that China has not released crucial rare earth minerals, and magnets, as rapidly as hoped since the two countries agreed an initial trade pact in Geneva a month ago. Treasury secretary Scott Bessent told reporters in London they had a 'good meeting', Bloomberg reports, while commerce secretary Howard Lutnick called the discussions 'fruitful.' 7am BST: UK labour market report 10.15am BST: FCA CEO Nikhil Rathi and FCA chair Ashley Adler testify to Treasury Committee 2.30pm BST: World Bank to release latest economic forecasts Update: Date: 2025-06-10T06:23:19.000Z Title: UK payrolls fall 'notably' in May Content: Newsflash: The number of people on payrolls across the UK has fallen notably, in a sign that the jobs market is weakening. The latest labour force statistics, just released, show that payrolled employment decreased by 109,000 employees (0.4%) in May, compared with April. On an annual basis, there were 274,000 fewer employees last month, compared with May 2024, pulling total payrolls down to 30.2 million. The Office for National Statistics does caution that these estimates are more uncertain than usual; if they're accurate, though, it indicates that demand for workers at British firms is cooling. The revised estimate of employees on the payroll in April 2025 was down 55,000 on the month. The provisional estimate for May 2025 was down another 109, more about this release ➡ The largest decrease was in the accommodation and food service activities sector, a fall of 124,000 employees in the last year, while health and social work added 62,000 employees. ONS director of economic statistics Liz McKeown says: 'There continues to be weakening in the labour market, with the number of people on payroll falling notably. Feedback from our vacancies survey suggests some firms may be holding back from recruiting new workers or replacing people when they move on. Update: Date: 2025-06-10T06:22:54.000Z Title: Introduction: US-China trade talks resume in London Content: Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy. Trade talks between the US and China are set to resume in London today, as officials push for a breakthrough over shipments of technology and rare earth elements. After more than six hours of talks on Monday, negotations will resume at Lancaster House later this morning. Investors are hopeful of a breakthrough that could continue to ease tensions between the two economic superpowers. President Donald Trump has indicated that the first day of talks were encouraging. He told reporters that 'We are doing well with China. China's not easy….I'm only getting good reports.' The US are unhappy that China has not released crucial rare earth minerals, and magnets, as rapidly as hoped since the two countries agreed an initial trade pact in Geneva a month ago. Treasury secretary Scott Bessent told reporters in London they had a 'good meeting', Bloomberg reports, while commerce secretary Howard Lutnick called the discussions 'fruitful.' 7am BST: UK labour market report 10.15am BST: FCA CEO Nikhil Rathi and FCA chair Ashley Adler testify to Treasury Committee 2.30pm BST: World Bank to release latest economic forecasts
Telegraph
29 minutes ago
- Telegraph
Thames Water lenders demand reprieve on fines in £17bn rescue deal
Thames Water's most senior lenders have demanded a reprieve on historical fines as part of its £17bn rescue package to save the struggling utility giant. A group of creditors including aggressive US fund Elliot are asking Ofwat for a 'regulatory reset' to avoid hundreds of millions of pounds in fines and penalties as part of proposals to secure the company's future. A source close to the group said they were urging regulators 'not to reach back into history' and instead focus on Thames Water's turnaround efforts moving forward. The attempt to avoid penalties comes after Thames was hit with a record £122.7m fine last month for sewage leaks and breaching dividend rules. Fitch currently estimates that the water sector will face £900m in fines over the next five years. Private equity giant KKR last week abandoned its £4bn takeover bid for Thames, in part because of concerns about future fines. The decision has plunged the debt-laden business into a fresh crisis, amid concern it could run out of cash within months. Creditors have now put forward plans to immediately inject £5bn worth of funding into Thames to help repair its balance sheet, including £3bn of direct investment and £2bn of debt expected to be raised by the group. If the new proposals go ahead, several billion pounds of debt will also be written off by creditors, valuing the total package of support at £17bn. The group claims the debt write-offs will deliver the largest financial loss ever suffered on an infrastructure investment in the UK. However, creditors are targeting a future stock market listing that will ensure a profitable exit. Plans put forward envision a 15-year turnaround effort that will include direct investment in wastewater, sewer capacity, storm overflows, metering and leak detection. A spokesman for the creditors said: 'These investors have the funding and experience required to deliver a transformation of the company's performance which is intended to mark a departure from past failings, creating a 'new' Thames Water that works effectively alongside Government, regulators, and customers to deliver for the environment and economic growth.' Sources close to the creditors said they were hoping to have their package approved by early autumn, with the hope of taking full control of Thames by the end of the year. The proposed rescue will also tee up a potential clear-out of Thames Water's management, as the creditors seek to enlist the relevant experts to improve its fortunes. The future position of Chris Weston, chief executive, is uncertain. An Ofwat spokesman said the regulator had 'been engaging regularly with Thames Water as it has progressed its process to raise additional equity'. The watchdog added it had begun a review of the submission from the creditors and was focused on assessing if the plans were realistic and deliverable. A Thames Water spokesman said: 'Our focus remains on a holistic and fundamental recapitalisation, delivering a market-led solution which includes targeting investment grade credit ratings and returning the company to a stable financial foundation. 'The Board will consider in the weeks ahead the full recapitalisation and turnaround plan submitted by our creditors. Constructive discussions with our many stakeholders continue.' A government spokesman said: 'The company is stable, and government is carefully monitoring the situation. We expect the company to continue to meet its obligations to both customers and the environment.' Thames Water has been embroiled in a row over bonuses paid to its most senior staff members despite its perilous finances. Last week, the Government announced new measures to ban six firms, including Thames Water, from handing bonus payments to their top executives after falling short of standards set by Ofwat. The company confirmed to the Environment, Food and Rural Affairs (EFRA) Committee that 21 members of its senior management team had received 'retention payments' of 50pc of their base salary. In a letter to the EFRA committee Sir Adrian Montague, the chairman of Thames, said the company had promised bonuses totalling £18.5m, to be paid between 30 April 2025 and June 2026. Thames said the additional payments had been paused but said it would not recoup the money already been paid out. Alistair Carmichael, the chair of the EFRA committee, said: 'As a committee, we are trying to seek clarity as to whether these payments fall within the remit of the Government's ban and will be recouped, given that they were not paid to the company's CEO or CFO and are termed by Thames Water as 'retention payments' rather than bonuses.' Thames Water said retention payments were 'commonplace in these types of deals', adding: 'None of the retention payments have been funded by customers.'
