In the month of November buyer demand for property has risen. Yet economic uncertainty continues to hold back the market from any meaningful recover according to RICS UK Housing Market Survey.
Seven per cent more surveyors reported new buyer enquiries rose rather than fell during November. This was the third consecutive monthly increase for the series, which is a good indicator of buyer demand in the market. Although the pick-up in interest signalled by the results is still modest, this is the first time since the spring of 2010 that the series has been in positive territory for three months in a row.
The improved tone to buyer demand was also reflected in an improvement in the level of sales transactions. Newly agreed sales rose, with 14 per cent more respondents reporting sales increased rather than decreased (from 9 per cent more in October). Alongside this, the average number of sales per surveyor (per branch) climbed to 15.4 in the three months to November. Although still very subdued, this is the best level since September 2010.
During November, surveyors were again asked about the factors which they felt were holding back activity in the housing market. Most cited was uncertainty in the economy and this reason was given by 89 per cent of respondents (compared to 79 per cent three months ago). Availability of mortgage finance came in at 70 per cent, while fear of house price falls remained steady at 42 per cent.
The house price balance continues to be negative, with 17 per cent more chartered surveyors reporting price declines rather increases in November – although this is an improvement from October’s reading of -24 per cent. Significantly, close to three-fifths of surveyors indicated that prices had not changed over the month and of those reporting a fall; the vast majority indicated that it had been in the 0 to 2 per cent range.
Looking ahead, it remains a broadly similar story to that signalled for much of 2011. Price expectations remain barely changed at -21 per cent while the net balance for sales expectations is still in positive, albeit low, territory at + 5 per cent.
Commenting, RICS housing spokesperson, Alan Collett, said:
“It is encouraging that buyer interest has edged upwards in the face of the endless diet of negative news from Europe and the turmoil in financial markets. However, a meaningful recovery still seems some way off.
“While the proposed mortgage indemnity scheme is clearly likely to provide some assistance for the market and is to be welcomed, its focus on the new build sector will inevitably mean that it only offers support for a relatively small share of the market.”
Source : RICS
