Renewed optimism in housing market despite low supply
Renewed optimism in housing market despite low supply
Tuesday 11th August 2009
Optimism in the UK housing market is continuing to improve, despite low stock levels.The Royal Institution of Chartered Surveyors (Rics) housing market survey out today found sentiment in the housing market was continuing to improve, with eight per cent more surveyors expecting prices to rise rather than fall.
The rise was the highest reading since April 2007.
The Rics survey found new buyer enquiries remained high, although marginally lower than the previous month. However, as reported in a number of housing market surveys in recent months, the levels of housing stock on the market remained at low levels.
The survey stated: "In July more chartered surveyors reported an increase than a decrease in the number of new instructions for the first time since May 2007. However the positive net balance of just two per cent suggests that vendors are still a little reluctant to put properties on the market."
Positively, the actual transactions also continued to rise in July, with the monthly increase in the agreed sales net balance pushing that measure to its best level for a decade.
Rics found in their survey there was a north/south divide in the English market, with the sales-to-stock ratio highest in London and the south-east and lowest in the north.
Rics spokesperson Jeremy Leaf said: "Although demand for property is continuing to rebound, it still remains low from a historical perspective. Crucially it is the lack of supply that is helping to underpin prices at the present time.
"Significantly, the more positive news on prices - at least in some parts of the country - may prompt more properties to come on to the market. If mortgage availability remains insufficient to meet the increase in buyer demand, then it is possible that prices may slip back again especially if unemployment continues to rise and mortgage rates increase.
"The pattern emerging in the regions is very interesting, with more chartered surveyors in London, the south-east and the south-west reporting rising prices, whilst those in the north are clearly experiencing a very different marketplace."
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