The UK housing market is beginning to recover after the post-referendum drop, figures from the Royal Institution of Chartered Surveyors suggest.
The August 2016 RICS Residential Market Survey results point to a gradual recovery in confidence following a significant drop immediately after the EU referendum.
Prices and sales volumes are now expected to rise going forward, both at the three and twelve month time horizons, with a more stable trend in activity driving the improvement in sentiment, the survey shows.
The headline price indicator edged higher during August, with a net balance of +12 per cent of respondents reporting an
increase in prices (up from +5 per cent previously).
This halts a run of five consecutive reports in which the net balance had
softened, although the current reading is still the second weakest posted over the past eighteen months.
In London, the net balance remained negative for a sixth consecutive month, with 30 per cent more respondents noting a fall in prices, as opposed a rise.
By way of contrast, the net balance figures suggest prices increased in most other parts of the
Looking ahead, national near term price expectations climbed into positive territory for the first time since April, with a net balance of 10 per cent of respondents now anticipating prices will rise over the coming three months.
Nevertheless, expectations remain generally modest across the UK.
Contributors are projecting prices in the North East to slip a little further in the near term but London expectations have now stabilised.
Yorkshire Building Society chief economist Andrew McPhillips says: “Activity in the housing market appears to have recovered following uncertainty caused by the EU referendum and the effects of the increase in stamp duty for landlords.
“Although these statistics, along with other favourable economic reports for August, paint a positive picture, they could also be seen as the beginning of the choppy market conditions we are likely to see in the medium term as a result of people’s uncertainty around how post-Brexit UK will look.
He adds: “Despite wider economic uncertainty, the main constraint in the housing market is the lack of supply, which will cause house price inflation to grow at a steeper rate in response to increasing levels of demand.
“In order to make properties more affordable, the UK needs to build more properties and remove other financial barriers for first-time buyers and those moving home in order to accommodate increasing levels of demand in the long term.”