The net balance of Chartered Surveyors reporting rises rather than falls in house prices reached a positive reading of 34 in October, up from 20% in September - this is the highest result since December 2006. London is leading the upturn in prices with the net balance of surveyors reporting rises rather than falls for London climbing to 95% - the highest figure since December 1996.
However, the survey also contains some evidence that vendors are beginning to return to the market. A net balance of 15% of surveyors reported that new instructions had increased in October, compared to a reading of 5% in September. Significantly, all regions reported a rise in instructions for the first time since the onset of the credit crunch with the North, the South West and London leading the way.
Meanwhile, transaction levels continued to rise with sales per surveyor edging up to 19 over the past three months. As a result, the closely watched sales to stock ratio - a measure of market slack and a lead indicator of future prices-climbed a little further. It has now risen for ten consecutive months and stands at 30.
The pace of improvement in buyer interest slowed for the fourth consecutive month. The net balance of surveyors reporting an increase rather than a decrease in new buyer enquiries slipped from 35% in September to 31%. However, only East Anglia is seeing a fall in buyer enquiries while buyer interest is strongest in London.
Commenting, Jeremy Leaf, RICS spokesperson, said: “Although the supply of property is beginning to pick-up, it is still insufficient to keep pace with the increase in demand which points to further prices gains in the near term. Cheap money remains a critical prop for the market and this is being reflected in the continuing appetite for finance from first-time buyers despite the large deposits still being demanded by lenders."
