Housing Market Stalls

Writing for Zoopla  

… Nicky Burridge reports(Sept 11^th)  that property sales, buyer enquiries and new instructions all failed to improve in August following a brief early summer bounce in the property market.

Downward Trend Resumed  

Property sales resumed their downward trend in August as ongoing Brexit uncertainty continued to weigh on the market. The increase in buyers seen in the early summer months also came to an end, with new enquiries flattening out, according to the Royal Institution of Chartered Surveyors. Unsurprisingly, given the generally downbeat mood, the number of new homes being put up for sale also failed to increase.

RICS Concurs  

Simon Rubinsohn, RICS chief economist, said: “It is hard to get away from the shadow being cast over the housing market by the seemingly never-ending Brexit saga.
“That said, the key RICS activity indicators have actually remained relatively resilient until now pointing to only a modest dip in transactions across the country rather than anything more severe.”

Why is this happening?  

The political and economic uncertainty caused by Brexit is causing would-be buyers and sellers to put their moving plans on hold until the outlook is clearer. While the market enjoyed a slight rise in activity in the early summer, this now appears to have petered out, as people remain cautious ahead of the current October 31 deadline for the UK to leave the EU.

Let’s Be Positive 

On a more positive note, the fact that both buyers and sellers are adopting a ‘wait and see’ approach has provided some support for house prices, which remained largely unchanged in August.

Who does it affect? 

RICS said the housing market had weakened in nearly all areas of the country during the past two months. In terms of sales, Wales and the North East were the only regions in which estate agents presented a more upbeat picture. The finding is in line with other housing market data which suggests activity levels are more buoyant in areas where affordability is least stretched.

What’s the Background? 

Going forward, sales are expected to fall further in the coming three months, with estate agents feeling the most pessimistic about the short term since February this year. The situation is expected to have improved “only very modestly” in 12 months’ time.

Price Optimism 

But surveyors are more optimistic about house prices, and while they are predicting near-term falls, they expect property values to be higher a year from now. Meanwhile, in the lettings market the mis-match between supply and demand worsened. Inquiries from potential tenants increased for the eighth month in a row, while new instructions from landlords fell, continuing the trend begun in 2016. Unsurprisingly, the situation is expected to push rents higher during the coming three months.

Top 3 takeaways 

Addressing the Issues 

Clearly more new homes are required globally. Making them ‘Off-Site’ using latest technology, innovative materials and digitising design stacks up well in terms of making them more economically and cot effectively. Some of the work of architects and surveyors in the process in the Design for Manufacture & Assembly (DfMA) requirement means that housebuilders and contractors can still  to incorporate ‘Off-Site’ into their procedures and processes without necessarily building ‘me-too’ volumetric boxes (although they have a place). Better still, they can seek partnering arrangements with such manufacturers to gain all round benefits.

DfMA 

As Off-Site Construction matures into Design for Manufacture and Assembly (DfMA) this is clearly at the forefront in turning construction workers into technical deliverer and enablers for such delivery. Additionally, new homes will very soon be ‘Smart’ in numerous ways, including full incorporation of energy saving and TIoT (the internet of things) to deliver major components. This is something that ‘Off-Site’. DfMA (Design for Manufacture & Assembly) will need to seriously consider as the industry moves forward.

Collaborative Partnering 

Greater collaborative ‘partnering’ between architects, builders and  manufacturers is needed to accomplish this The greater speed, accuracy and quality that can result from manufacturing components in a dry, controlled factory environment, together with the ability tom incorporate (yet to be invented) ‘Smart Ware’  gives home builders perhaps the only way of achieving this, together with improved on-site build quality AND controlling costs.

Resistance Disappearing 

While resistance to the change to DfMA has been the norm, the wish of most UK Builders to deliver excellent customer service and top notch homes is now driving an increasing number to choose Off-Site for their developments. Also, as ‘OffSite Hub” note, architects and designers are moving toward DfMA, something we have been encouraging for over 20 years. The emergence of LA Developers will only speed up this process.

Easy Timber Frame 

To assist them in doing so our “Easy Timber Frame “ now offers standard size modular timber frame elements for them to use as a design base, cutting down on technical design and engineering to produce win-win results.

Better all-round Savings