Cautious Optimism On House Sales

Cautious Optimism On House Sales

by Paul Forrest on 16 Jan, 2012

The Royal Institute of Chartered Surveyors Housing Market Survey December 2011

The December 2011 Housing Market Survey, conducted by the Royal Institute of Chartered Surveyors (RICS) and released on 9th January 2012, gives a slightly brighter outlook than in recent times. Surveyors taking part in the monthly survey are asked to indicate by how much the average house price has changed over the previous three months.

The third consecutive monthly gain in availability of properties for sale has sustained the recent increased interest in buying.  The final three months of 2011 recorded an average of 15.2 sales per surveyor per branch, the second highest since the previous autumn. The indications are that the New Year should bring higher numbers of house owners looking to sell.

Although the net price balance, the ratio between surveyors reporting price increases and losses, is still a negative figure (-16) this is the highest rating since July 2010. Looking at the share of survey respondents who report no change in price levels, which topped 62%, this is the highest result for eighteen months.

London remains the only region in the UK to continue to register price increases, along with the expectation of prices continuing to rise.

West Midlands reported the biggest negative net price balance of -47, with Yorkshire and Humberside experiencing -43. Northern Ireland was the next worse performing region with a net balance of -39.

Nationally, interest from potential buyers appears to be steadily increasing. This is however being tempered by continuing reports of reluctance by some lenders to make mortgage finance available. Cash-rich buyers remain in a stronger position to buy than those needing to borrow.

Forecasts for the next three months indicate an expectation of continuing price decreases.

Ian Perry, RICS Housing Spokesman reports:

“While it’s encouraging that sales activity held up relatively well towards the end of the year, continuing problems with the economy and the ongoing instability in the eurozone seem to be weighing heavily on the UK housing market and expectations for the coming months are fairly subdued.

The increasing number of prospective sellers who placed their homes on the market in December is a positive development as a lack of stock has been a big issue in some parts of the country, but with house sales expectations remaining flat, it is important that vendors are realistic in their pricing if they wish the sale to go through in good time.”

In conclusion, despite the continuing negative results of house sales around most of the UK, the trends do seem to indicate a levelling off in the decrease of house prices, while the capital continues to defy the overall picture. Whether the New Year brings renewed levels of optimism remains to be seen.

About the Author

Paul Forrest

Paul Forrest is an experienced writer in many fields of interest and we are delighted that he will now be a regular contributor to in 2012.