House sales to jump in the months ahead

There was a steady improvement in sentiment in March, with home buyer demand and the supply of available properties rising, according to the Royal Institution of Chartered Surveyors (Rics)

Surveyors are forecasting that house sales will jump in the months ahead.

There was a steady improvement in sentiment in March, with home buyer demand and the supply of available properties rising, according to the Royal Institution of Chartered Surveyors (Rics).

But it warned that, against a backdrop of higher mortgage rates, the scope for acceleration in housing market activity “will still be relatively limited”.

8% of property professionals reported seeing inquiries from new buyers increasing instead of dropping in March. This was the most positive result since February 2022, Rics added.

The flow of new property listings rose for the fourth consecutive month, with 13% of professionals noting a rise in new instructions to sell in March.

Looking to the next three months, 13% of professionals expect house sales to rise. Over the year ahead, 46% are expecting to see a rise in sales.

There were also signs of house prices steadying. 4% of professionals observed prices dropping instead of increasing in March.

While this was a negative reading, the balance was considerably narrower than 67% of professionals who saw prices dropping instead of rising back in September 2023.

In the lettings market, demand from tenants continued to increase, while landlord instructions dropped, pointing to a squeeze on supply.

Consequently, 34% of professionals expect rental prices to increase in the next three months.

Tarrant Parsons, senior economist, Rics, said: Demand continues to recover gradually across the UK housing market, with new buyer inquiries rising for a third successive month as per the latest survey feedback.

Parsons added: With the inflation backdrop turning a little less difficult of late, this has led to expectations that the BoE will be able to start lowering interest rates later in the year. This should continue to support the market to a certain degree going forward.

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