RICS Say Home Sales Are On The Increase

Some better news for the housing market as the latest figures from the Royal Institute of Chartered Surveyors (RICS) indicate that the number of buyers in the UK housing market has risen for the third consecutive month.

It said lower house prices had prompted renewed interest from potential buyers, especially those who already own a house or flat although first-time buyers were still finding it difficult to get on the ladder.

RICS beleive that improvement was likely to continue in coming months and mortgage approvals could climb above 35,000 per month as a result.

RICS chief economist Simon Rubinsohn said: “Our suspicion is that this improvement in activity levels is likely to be sustained over the coming months...However, this would still be well down on the high for the cycle as well as being significantly below the long run average...By no means could this relatively small pick-up in transactions be seen as representing a move back to a more orderly housing market.”

More than 70% of surveyors said low prices were the main factor in driving buyer interest and almost half said buyers think the bottom of the market is now in sight.Around three-quarters of surveyors said existing homeowners were driving the jump in enquiries while just 23% reported increased interest from first-time buyers.

House prices fell by 10% in 2008 in the UK, according to the government's own house price survey.The figures from the Department for Communities and Local Government (DCLG) showed that the average UK house price had fallen to £195,317 by December, a drop of £22,690 over the year.

Figures from the Halifax and Nationwide show house prices have fallen by around 20% since their peak in 2007, but the RICS said many surveyors thought the fall was closer to 30%.

Rubinsohn added: “Interest from owner-occupiers is likely to persist over the coming months as those with large deposits look to capitalise on the drop in house prices...However, a sharply deteriorating employment picture may eat away at this improvement in sentiment, pushing potential buyers back to the sidelines.”