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Home buyer demand seeing return to growth

Home buyer demand seeing return to growth

Demand for new home purchases rose in September 2016 for the first time since February, according to new industry data.

Figures from the latest UK Residential Market Survey by the Royal Institution of Chartered Surveyors (RICS) has shown that eight per cent more chartered surveyors reported an increase in buyer enquiries last month - the first improvement in levels of buyer demand for seven months, although conditions varied according to region.

However, this modest rise in buyer demand was offset by another drop in the number of new instructions being received by agents, continuing a pattern that has largely prevailed since the middle of 2014.

As a result, the average level of stock on estate agents books remains close to historic lows. The drop in housing supply and increase in buyer demand is expected to push up prices both over the short and longer term.

Indeed, over the next three months, 14 per cent more respondents to the RICS survey say they expect to see an increase in prices than those anticipating a drop, which marks the strongest reading since March.

This imbalance between supply and demand is likely to continue over the coming months without a concerted effort to build more houses to add to the overall national stock.

Simon Rubinsohn, chief economist at RICS, said: "The market does now appear to be settling down following the significant headwinds encountered through the spring and summer.

"Buyers do appear to be returning, albeit relatively slowly, but the big issue that continues to be highlighted by respondents is the lack of fresh stock on the market. Although this is not a new story, it is a significant one having ramifications for both prices and the level of turnover."

Image credit: apomares via iStock

 

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