House sales strengthens market

09/04/13

By Daniel Machi

March provided some good news for the housing market, with sales lifting to a three-year high and prices experiencing a "marked" turnaround.

Chartered surveyors each sold an average of around 17 homes during the three months to March - the highest number recorded since March 2010.

In addition, research from the Royal Institution of Chartered Surveyors (RICS) revealed that 21 per cent of surveyors reported an increase in house prices, which is the highest proportion recorded since June 2010.

A balance of one per cent more surveyors still reported house prices falling rather than rising, but this is significantly down on the seven per cent net balance reporting falls the previous month.

Demand from would-be buyers intensified in March, with a balance of 11 per cent more surveyors reporting increases in new buyer enquiries rather than falls, marking the highest share in five months.

The figures suggest confidence is slowly returning to the market - a welcome and much needed boost for buyers and sellers alike.

Lenders and estate agents have been reporting signs of a tentative housing market recovery ever since the launch of the Government's Funding for Lending scheme last August.

It has prompted an increase in mortgage availability and is seeing lenders continue to slash their rates as they borrow more money at lower rates.

Peter Bolton King, RICS global residential director, claimed such initiatives are gently easing the pressure on the market and freeing up stagnant chains.

"A buoyant, healthy property market is central to economic recovery and, while these are still very much early signs, it is encouraging that sales are beginning to pick-up," he said.

"The increase in potential buyers getting out there and viewing property is particularly encouraging."

Potential homebuyers with smaller deposits are also to receive extra help from the Government after it recently announced the Help to Buy Scheme, which will give a helping hand to people with deposits of just five per cent.

This initiative will be available for purchase of any home old or new and not just for first time buyers, so it is hoped it will help lenders provide more mortgages to more people.

Mortgage availability is generally increasing and surveyors are optimistic that the sales rebound is set to continue in the coming months, with a balance of 19 per cent more expecting transactions to jump over the next three months rather than fall.

They are also upbeat about prices rising, although this will be achieved over the course of the next 12 months rather than the shorter-term.

RICS said that London continues to be the "standout performer" in terms of house price gains, with the south east also witnessing modest increases.

Meanwhile, Northern Ireland reported price increases rather than decreases for the first time since July 2007.

Wales, the South West and the Midlands all recorded flat or slightly negative price balances, while Scotland has seen less severe price falls so far this year compared to 2012.

Surveyors in the West Midlands have seen the biggest increases in homes sold since the start of the year, followed by those in London.

At the other end of the scale, sales increases in East Anglia and the East Midlands were found to be the flattest.

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