Supply outpacing demand, says RICS
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New instructions have outweighed buyer interest for the second month in a row, according to the Royal Institution of Chartered Surveyors.
New instruction and new buyer enquiries both recovered in February after the housing market was hit in January by adverse weather conditions.
Some 7% more chartered surveyors reported a rise than fall in new buyer enquiries compared with the previous month, up from a negative reading of 20%.
A net balance of 15% of surveyors saw a rise in new instructions, again an improvement from January’s negative balance of 5%.
But the proportion of surveyors reporting a rise rather than a fall in house prices has dropped, going from 31% in January to 17% last month.
RICS says that regional surveyors continue to report an increase in house prices in most areas.
Yet surveyors in the North, Yorkshire and Humberside, Wales and the West Midlands are all reporting house price falls.
Fewer surveyors are predicting house price rises, with the number of surveyors expecting house prices at its lowest since last July.
A spokesman says: “Most market indicators are still positive and consistent with further house price increases.
“But the magnitude of the gains going forward is likely to continue to ease reflecting the fact that new supply coming onto the market is starting to outstrip fresh demand.”
Readers' comments (3)
Anonymous | 9 Mar 2010 12:22 pm
"New instructions have outweighed buyer interest for the second month in a row, according to the Royal Institution of Chartered Surveyors."
This statement makes no sense to me. Are new instructions not coming from buyers. If not where are the instructions coming from?
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Mark Sutton | 9 Mar 2010 4:24 pm
With month on month increases in house prices fueled by the lack of supply last year, it is no surprise that more people are choosing to put their houses on the market this spring. What we need now is to be able to match the supply with a demand and satisfy that demand with lenders willing and able to lend to them. If this does not happen, then everyones worst fears of a double dip in house prices is a frightful reality.
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Grey Haired underwriter | 10 Mar 2010 11:05 am
with referene to Mr Sutton's comments above, it is not a case of lenders being unwilling to lend but it is the availability of funding. At the end of the day no lender can lend money it doesn't have and this is the major issue for the market. This is only going to get worse as the BoE calls back the seocial liquidity funding and these monies have to be replaced - but from where? I don't think that savers are going to be able to compensate for the large sums of cheap money that the State ploughed into the top lenders coffers so there will be a mad scramble for funds and undoubtedly mortgage costs will have to rise to cover ever higher savings rates. Enjoy the lull before the storm
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