Purchasers of South West property dropped in February due to flooding13th March 2014

According to the Royal Institution of Chartered Surveyors (RICS), growth in would-be buyers in the South West dropped to its lowest point in over a year and a half during February, as adverse weather hit the region’s market and the initial clamour from those previously shut out of the property market began to level off.

Last month, buyer numbers increased at their slowest rate since June 2012 as the initial surge in demand, driven by the more accessible housing market, dropped. However, the amount of homes coming up for sale in the region also fell significantly during February, reaching its lowest point in almost ten years. It is perhaps unsurprising that limited activity has coincided with the recent flooding and adverse weather, and it remains to be seen what impact the floods will have on the South West market over the coming months.

Moving on to prices, the cost of a home in the South West continued to rise during February, albeit at a slightly slower pace than in previous months. Last month 36 per cent more chartered surveyors saw prices rise rather than fall. Looking at the UK as a whole, the cost of a home has now risen across the country for 11 consecutive months.

In spite of the recent dip, respondents predict both prices and transaction levels to continue to increase going into summer when the market traditionally starts to pick up.

Roger Punch, RICS Residential Spokesperson for the South West, said: “The recovery in the South West housing market has been severely impacted by the flooding in the region, although this is a localised issue with this downturn not seen everywhere. The imbalance between supply and demand is as ever present and some areas still remain the strongest they have been for some time. As the weather improves we are already seeing the volume of sales increasing, with many properties that have been on the market for some time gaining offers.”

Simon Rubinsohn, RICS Chief Economist, said:

“The growth in buyer numbers that we’ve seen for some months started to slow down in February, as the surge in interest sparked towards the end of last summer began to level off. While this certainly doesn’t mean an end to the increasing activity we’ve been seeing recently, it does suggest that the pent up demand generated throughout the downturn is gradually exhausting itself. One other factor influencing behaviour over the past month may be the weather as rain, wind and, in particular, floods tend to mean fewer people are willing to actually get out there and view houses.

“The ongoing issue that we are facing, however, is the lack of homes coming onto the market. Yes, it is true that more and more are being built, but supply is simply not enough properties to satisfy demand. As a result, prices are likely to continue to move higher making it ever harder for people to take an initial step foot onto the property ladder.”