June 12, 2013
House sales reach highest level for three and a ha
The number of properties sold in the UK in the past three months reached its highest level since January 2010 in May as buyers across the country began to return to the market, according to research.
Chartered surveyors sold an average of 17.9 houses during the three months to May, the RICS residential market survey found.
This is still low compared to the market peak of six years ago, but still represents the highest reading for more than three years.
Ten years ago, as the chart above shows, surveyors would have expected to sell more than double this but sales have slowly picked up and are well above extreme-low transaction levels seen in 2009.
The small boom in sales is expected to continue during the summer with a net balance of 35 per cent more respondents predicting transactions levels will grow – up from 26 per cent in the last survey.
A key driver in this jump in activity is the recent upturn in buyers testing the market.
The report says that interest from would-be buyers has new risen for the last four consecutive months – and during May, 30 per cent more chartered surveyors reported rises rather than falls in new buyer enquiries.
This represents the highest reading since October 2009 and is a sign that market confidence is gradually being restored, RICS says.
Property values edged up last month, with five per cent more chartered surveyors reporting increases rather than decreases.
Until recent months price stability has been confined largely to the South East of England and London, but now this is beginning to extend to other areas of the UK.
Some respondents of the survey pointed to recent government schemes as the stimulating factor for the demand.
Chris Cockwill from Cockwill & Co in Southport, Merseyside, said: ‘Following a relatively quiet post Easter period, the last month has seen much more activity from buyers and sellers, with many of them expressing confidence in the recent government assistance in the help to buy schemes.’
With the sales market maintaining its slow recovery, chartered surveyors also expect house prices to rise over the coming three months, with a net balance of 20 per cent more respondents now predicting growth.
Only respondents in the North and East Anglia expect prices to weaken in the coming months, as the graph below shows, while London, the South East and North West are expecting the strongest growth.
The RICS research echoes recent house price surveys for May. Halifax says property values are up 2.6 per cent annually, while Nationwide says prices are up 1.1 per cent compared to a year ago.
RICS says that on the rental market front, tenant demand continued to rise during May, although the rate of growth has begun to slow in the last few months.
Respondents to the survey predict further rises in rents over the coming three months.
Peter Bolton King, global residential director at RICS, said: ‘May was an interesting month for the housing market. More people decided to get out there and view property and more transactions went through than in quite some time.
‘Most encouragingly of all, though, is that stability is not confined purely to London and the South East, as has been the case, but is now starting to extend to areas right across the country. There is still a very long way to go until we see a full scale recovery but green shoots are beginning to sprout.’