February 13, 2020 12:01:00 AM
House sales picked up in January as the property market got off to a positive start to the year, surveyors have reported.
Both the number of sales being agreed and the supply of homes coming onto the market increased, the Royal Institution of Chartered Surveyors (Rics) said.
An overall net balance of 19% of surveyors reported the number of new homes listed for sale had increased rather than decreased.
A net balance of 21% of surveyors also reported that the number of sales being agreed had increased.
Looking ahead, property professionals expect this refreshed optimism to continue – with sales expected to see an uplift across all UK regions in the next few months and for the year to come.
But Rics also cautioned that the improvement in housing availability follows a sustained period of falling supply, meaning average stock levels remain very low at an average of 43 properties per branch.
It also said that as activity lifts, the upward pressure on house prices appears to be building.
House prices increased across the UK for the first time since July 2018.
The upwards pressure is being fuelled by a turnaround in London and the South East – where the direction of house price growth is now upwards, having been stuck on a downward path for the past few years.
In London, the last time prices were reported by surveyors to be increasing rather than decreasing overall was in February 2016 and in the South East the last time was May 2017.
Elsewhere, Northern Ireland and Scotland are currently showing the strongest growth in house prices across the UK, Rics said.
Going forward, surveyors across the UK expect prices to increase both in the coming three months and over the year ahead.
The Rics data adds further weight to recent evidence of a housing market pick-up following the December General Election.
Property portals OnTheMarket.com and Rightmove both recently reported seeing record traffic to their websites in January.
Last week, Halifax reported that house prices increased by 0.4% month-on-month in January – although that report said that it was too early to say if a corner has been turned.
Simon Rubinsohn, Rics chief economist, said: “The latest survey results point to a continued improvement in market sentiment over the month, building on a noticeable pick-up in the immediate aftermath of the General Election.
“The rise in new sales instructions coming onto the market is a noteworthy and much needed development, given the lack of fresh listings over the past few years had pushed stock levels to record lows.
“It remains to be seen how long this newfound market momentum is sustained for, and political uncertainty may resurface towards the end of the year.
“But, at this point in time, contributors are optimistic regarding the outlook for activity over the next 12 months.”
Russell Galley, managing director of Halifax, said: “Although we have seen a pick-up in transactions, it’s too early to say if a corner has been turned. The recent positive figures may actually represent activity that would ordinarily have been expected to take place last year, but was delayed by economic uncertainty.
“We still expect a moderate rate of house price growth over the course of the year as demand is likely to continue to exceed the supply of properties for sale across the UK, with a subdued pace of new building adding to upwards price pressure.
“The environment for mortgage affordability should stay largely favourable. However with the growth in rental costs accelerating, many first-time buyers will continue to face a significant challenge in raising necessary deposits.”