New enquiries in the market increased for the sixth consecutive month. Forty one percent more Chartered Surveyors reported a rise than a fall in new buyer enquiries up from 32 percent in March and the highest figure for almost a decade. The balance of surveyors reporting increased buyer interest in London is the second highest figure recorded since the series began. 70 percent more Chartered Surveyors reported a rise than a fall in new buyer enquiries in London, up from 63 percent in March.
Some of this interest is translating into sales but transactions still remain at low levels. Surveyors sold an average of 10.6 properties over the past three months, up from 9.7. Also, the balance of newly agreed sales continued to rise and surveyors in most now expect this trend to continue. This is the first time that surveyors have been universally optimistic about sales since August 2006.
It is also noteworthy that the sales to stock ratio - widely viewed as a key gauge of market slack - has risen for the fourth consecutive month indicating that some stabilisation in prices may occur later in the year. In fact, the net balance of surveyors reporting house price falls eased again. 59.9 percent more Chartered Surveyors reported a fall than rise in house prices, from 72.1 percent in March.
Despite a deteriorating employment picture, the net balance of surveyors reporting new instructions to sell remains in negative territory indicating that supply is still very tight. Falling prices and subdued activity may still be discouraging potential vendors from putting property on the market. Meanwhile low interest rates are limiting the amount of forced sales.
Commenting, RICS spokesperson Jeremy Leaf said: "There are tentative signs that the market is starting to pick up but transactions remain at very low levels and we are unlikely to see significant improvement while money remains in short supply and the employment picture is uncertain. Transaction levels could benefit from an increase in supply but falling prices and low interest rates are discouraging sellers as is the latest change in HIPS legislation. House prices could stabilise in the coming months but prospective purchasers - and first-time buyers particularly - will continue to encounter challenges while banks maintain current loan to value ratios and make accessibility difficult even for those who have accumulated considerable equity in their existing properties."
