Britian's housing market received a double dose of gloom on Thursday as estate agent Countrywide warned of lower than expected full-year earnings, while UK chartered surveyors reported worsening demand for homes.
"The UK housing market continued to display a lack of momentum in December, with buyer interest edging lower," said the Royal Institution of Chartered Surveyors (RICS) in its December report into the UK housing market.
Activity in the UK housing market continued to drop in December. While 5% of respondents to the RICS survey in November's noted new buyer enquiries fell, a further 15% of respondents noted a similar pattern of declining demand in December.
Little positive impact was seen from government changes to stamp duty, with 86% of respondents saying they had seen no increase in demand due to the measures introduced in November's Budget.
Neither did the majority of respondents expect stamp duty reforms to have much impact on future demand, with 12% saying it would result in higher overall activity, but 66% anticipating "little consequence" from the changes.
While the balance of surveyors reporting that house prices had risen during the last three months increased to +8 from zero in November, the expectations balance of conditions in the coming three months resulted in a forecast of further price falls.
The expectations balance fell to -6 in December from -4 in November.
"November’s rise in interest rates has swiftly cooled the housing market," said Samuel Tombs at Pantheon Macroeconomics.
"With the MPC warning of two more hikes in the next three years and the Term Funding Scheme set to be wound up in February, rising mortgage rates will prevent price growth from recovering soon.
"As such, we continue to expect house prices merely to flatline over the next year."
The RICS data wasn't the end of the gloomy news in Britain's housing market. Countrywide, the estate agent, reported its full-year profits would not meet targets after a disappointing end to 2017.