General election dents demand for UK housing in April

Prime Minister Theresa May's decision to call a snap general election has dampened buying and selling activity in the UK housing market, a fresh survey has suggested.

New buyer enquiries and newly agreed sales both declined during April, the Royal Institution of Chartered Surveyors (Rics) said.

Some 22% more surveyors reported higher house prices in April, unchanged from the previous month.

Rics said a lack of choice for would-be buyers was among the factors hurting activity in the housing market.

The national sales gauge fell to -9% in April – the lowest reading since immediately after last year's EU referendum – from -3% in March.

Rics said the housing market is likely to remain depressed over the summer, with its measure of price expectations gauge for the next three months falling to 4% from 11%.

"An acute shortage of stock remains a key factor underpinning prices for the time being," Rics said.

"Average properties on estate agents books continue to hover close to record lows, while the headline indicator on new sales instructions remained negative for a fourteenth month in a row."

Surveyors expect housing sales to be flat over the next three months, although 31% more estate agents expect sales to pick up over the coming year.

"Although the picture clearly does vary across the country, the bulk of the feedback we are receiving points to a fairly flat summer for both activity and prices," Rics chief economist Simon Rubinsohn said.

"Lack of stock on the market remains a key challenge for the sector with recent and forthcoming tax changes having a material impact on transaction levels, particularly at higher price points.

"Uncertainty relating to the forthcoming general election is also highlighted by some respondents as a reason for inertia."

Data released by Halifax earlier this week suggested UK house prices fell 0.2% in the three months to April, the first quarterly fall recorded in over four years.

However, prices rose 3.8% compared to a year earlier in April, with the average price of a house at £219,649 ($284,252).