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Property market set for end-of-year boost, says Rics
The Royal Institute of Chartered Surveyors says house price falls are slowing, and new mortgage initiatives will help first-time buyers on to the ladder.
Hard-hit homeowners may finally see some respite from falling house prices, as the Royal Institute of Chartered Surveyors (Rics) predicts a strengthening of the property market at the end of the year.
The latest housing market survey is predicting a pick-up in property transactions and a slowdown in price falls, both of which will lead to a stronger housing market at the end of 2012.
Government initiatives to boost the property market, including the NewBuy initiative that aims to increase the number of first-time buyers, have helped boost the prospects for mortgage availability, meaning confidence among surveyors in future sales is at its highest peak since May 2010.
Although house prices in the UK are still falling, the pace is slowing. Rics’ national price balance, which covers England and Wales, showed 15% more surveyors reported a fall in house prices over the past three months, but 65% of respondents reported no change.
Of surveyors reporting falls 74% are reporting falls between zero and -2%, which Rics said is consistent with flat annual house price growth. London is still the only region where more surveyors are reporting price rises rather than falls.
When it comes to sales activity the overall outlook is ‘consistent with a flat picture’, according to RICS, although near-term sales expectations are high.
However Rics warned: ‘We would caution into reading too much into this – the UK lending data, though lagging the RICS data by a month, remain unambiguously weak and significant global even risk remains which could derail any recovery – there are some grounds for believing that activity could pick up over the coming months.’
First-time buyer activity is increasing, with more surveyors seeing an increase rather than a decrease in new buyer enquiries, although interest from would-be buyers has not seen any significant growth since the end of 2009.
Peter Bolton King, RICS global residential director, said: ‘The housing market was relatively flat during September but surveyors are optimistic that the run into Christmas could see an increase in activity in many areas of the country. Prices are still dipping but at a much lower rate than seen in previous months.’
It is not good news for everyone though, Bolton King added: ‘Problems still exist and more needs to be done to get the market moving. Unrealistic expectations o the part of vendors seem to be stalling the transaction process.
‘Meanwhile, although the funding for lending scheme appears to be improving mortgage availability, those at the very bottom of the housing ladder are still struggling.’
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