The RICS England and Wales Housing Market Survey Price Balance for March, which measures the proportion of real estate surveyors reporting a rise in price minus those reporting a fall, reported a change of -23% in March, beating an analyst consensus of -24% and improving from February’s change of -26%. The RICS report is one of the major gauges of the British real estate market that the Bank of England uses, along with the Halifax House Price, Nationwide Building Society – All Houses and the DCLG House Prices Index.
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The pound weakened against the dollar immediately after the report as investors saw the continued weakness in the British real estate market to translate into continued weakness in the overall economy. Following weaker housing prices from previous reports, investors are dimming their views of a possible Bank of England rate increase, next due May 5th, as the bank keeps rates at record low in order to foster recovery. With today’s data giving negligible support to an interest rate increase, persisting investor outlook of a slow-to-recover British economy may lead to continued pound weakness.
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