RICS HOUSING MARKET SURVEY

MARCH 2010

The latest RICS housing market survey shows that house prices continue to rise, but at a slower pace.

The March 2010 RICS Housing Market Survey showed surveyors remained positive on price movements over the last three months at the national level, but less so than in February. The seasonally adjusted net balance of respondents reporting increasing, rather than declining, prices fell from 18% to 9% in March.

Buyer interest stabilised following 14 months of consecutive increases (January's weather related fall excepted); the new buyer enquiries net balance fell from +7 to 0. Meanwhile, vendor activity continued to pick up with the new instructions net balance rising from +16 to +21, the highest reading since May 2007 (the month before HIPs were introduced).

Activity is expected to rise over the coming months, but at a more subdued pace than was expected in February, with the sales expectations net balance falling from +15 to +5. Meanwhile, prices are expected to more or less stabilise over the coming months, as indicated by the price expectations net balance, which fell from +5 to -2 in March.

The average stock of property on surveyors’ books increased by 6% on the month (the highest monthly increase since February 2008) to 67 per surveyor. Meanwhile, the average number of completed sales fell by 2.8% on the month to 17.1 per surveyor. This had the effect of lowering the sales to stock ratio — a key indicator of market slack — from 27.8% in February to 25.5% (the lowest reading since July 2009).

There was significant variation in regional price trends; London and the South East remained the clear outperformers, but Scotland also recorded convincing price gains. According to surveyors, more respondents reported that prices are now falling rather than rising in East Anglia, Yorkshire and Humberside, the North and the West Midlands. The net price balance remained negative in Northern Ireland.