The Royal Institution of Chartered Surveyors’ (RICS’) Residential Market Survey for the month showed the score for new buyer enquiries was 12%, similar to a reading of 11% in the previous month. This suggested a slight increase in buyer demand and was the fifth consecutive month this metric had a positive reading.
Despite this, surveyors scored just 1% for agreed sales in November, down from 8% previously, indicating a flat trend over the month. However, respondents anticipated activity to pick up in the near term, with a reading of 19% for agreed sales over the next three months.
This was lower than the score of 30% given in October.
As for 12 months into the future, surveyors gave a reading of 33% for agreed sales, expecting this to continue improving. This was the most positive reading for agreed sales over the next 12 months since April.
When it came to the supply of properties, new instructions continued to increase according to the reading of 17% given, higher than 14% the month prior. This was also the fifth consecutive month with positive readings for new instructions.
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However, respondents suggested that the number of market appraisals conducted was in line with the previous year, which RICS said might suggest that new listings would plateau in the coming months.
House prices start to rise
Respondents reported fairly strong growth in house prices, with a score of 25% in November, up from 16% in October.
RICS said the metric for house prices has steadily increased in the last four months, rising from as low as minus 16% in July this year.
All regions of the UK were reported to see an upturn in house prices, with strong growth in Northern Ireland, the North West, the North East of England and London.
Surveyors expect house prices to continue going up over both the next three months and the next 12 months, with a score of 47% for the next year.
Tenant demand in the negative for first time in four years
In the lettings market, tenant demand was flat at minus 1%, marking the first time it had fallen below zero since 2020.
RICS said some of this could be attributed to seasonal factors.
Landlord instructions continued falling, with a net reading of minus 13%. Respondents predicted rental prices to rise over the next three months, returning a score of 29%. However, this was the “least elevated” reading since January 2021.
Tarrant Parsons, senior economist at RICS, said: “Although the latest survey results continue to signal a steady improvement in buyer demand across the residential market, the broader macro environment is likely to pose additional headwinds moving forward. Most significantly, the recent rise in mortgage interest rates may curtail the recovery in market activity before long, and this is reflected in the slightly less optimistic sales expectations data coming through this month.
“Moreover, measures of consumer and business confidence across the economy have deteriorated of late and, if sustained, this could begin to feed through into housing market conditions in the months ahead.”
