The Royal Institution of Chartered Surveyors (RICS) UK residential survey for the month also showed new instructions and appraisals both rose by a modest seven per cent compared to last month. However, heightened demand seen in 2020 kept activity stable as overall, this was higher than the same period in 2019.
Agreed sales improved for the seventh consecutive month with a reported increase of 18 per cent. However, this was down on the 24 per cent growth recorded the month before and a steady decline from the highs in the summer, where the rise in agreed sales consistently exceeded 60 per cent.
Surveyor responses are measured on a net balance of 100 per cent to –100 per cent depending on whether respondents report increases or decreases.
Future sales activity
Surveyors expect sales to fall 22 per cent in the near term, likely due to current events related to the pandemic and continued pressure on the market, as it was down from November’s prediction of a six per cent drop. It also reflected the weakest sentiment towards future sales since April.
However, feelings towards sales levels over the next 12 months are not as pessimistic with surveyors suggesting a six per cent decline across the year.
House price growth has not waned according to surveyors, as 65 per cent of respondents reported increases during the month. This was the fourth consecutive month that reports of price growth had been between 61 and 65 per cent.
Looking ahead, a net balance of –13 per cent of respondents believe house prices will fall over the next three months before the market begins to stabilise, as +24 per cent expect prices to grow in the next 12 months.
Simon Rubinsohn, RICS chief economist, said: “Although the housing market remains open for business in the midst of the latest national lockdown, there is a sense from respondents to the survey that the new restrictions will still impact on transaction activity over the coming months.
“This is most visible in the negative reading for sales expectations over the next three months when typically, with the expiry of the stamp duty holiday approaching, this series would be expected to remain firmly in positive territory.”
He added: “Looking beyond this immediate time horizon, the feedback from RICS members is that the uplift in prices over the past year will be sustained, for good or ill, as the macro picture gradually improves on the back of the rollout of the Covid vaccination programme.”