House price rises ease in election run-up

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The Independent Online

Homeowners rushing to put properties on the market before the General Election sent selling activity to its highest since May 2007 last month, according to a survey today.

But the latest housing market survey from the Royal Institution of Chartered Surveyors (RICS) suggested that price rises eased in March.

RICS said 9% more chartered surveyors reported a rise than a fall in property prices last month, down from 18% in February.

Respondents said that while London, the South East and Scotland performed well, prices fell across East Anglia, Yorkshire and Humberside, the north and West Midlands.

And a fall in the sales-to-stock ratio - a key indicator of future house price inflation - suggested further stabilisation of prices throughout the remainder of 2010.

RICS reported new house sale instructions outpacing buyer activity for the third month in a row as political uncertainty ahead of the impending General Election prompted sellers to put up the "for sale" sign.

Seller activity rose to levels not seen since just before the introduction of Home Information Packs (HIPs) in 2007.

A net balance of 21% of surveyors saw a rise in new instructions, compared with a balance of 16% in February.

Meanwhile, new buyer enquiries stabilised in March with the net balance falling from 7% to zero.

The survey also revealed fewer house transaction completions, down 2.8% on the month to 17.1 per surveyor, which sent the sales-to-stock ratio to its lowest level since last July.

RICS spokesperson Ian Perry said: "With the General Election approaching and uncertainty growing over the political direction of the country, many vendors who were previously inclined to sit on the sidelines now appear eager to put their properties on the market."

He added: "For the time being, many of the key housing market indicators are still positive or stable.

"However, with stocks increasing and sales decreasing we may see some modest price falls in some regions although London, the South East and Scotland are continuing to perform well."

The poll showed that price expectations were lower among surveyors last month, with a net balance of 5% in February falling to minus 2% in March.

Activity is also set to slow, although expectations remain in positive territory, at a net balance of 5% as the traditional house-selling season gets into full swing.

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