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Optimism on house prices grows in February

Expectations for future house prices were more optimistic during February, according to the latest UK Housing Market Survey from the Royal Institution of Chartered Surveyors.

Surveyors reported a net balance of 0 on future prices, compared to -14 in January.

This is the first time since May 2010 that surveyors have not been predicting further price declines.

Alongside this, transaction levels continued to edge up with the average amount of sales per surveyor branch moving up to 16, compared to 15.7 in January.

RICS says that although this is still historically low, it is the most positive reading since September 2010 and suggests that the improvement in activity seen in recent months is continuing.  

But despite these positive trends, prices continued to dip during February, albeit at the slowest rate for over a year and a half.

Some 13% more surveyors reported price falls rather than rises in the last month, with London once again the only part of the country to see prices increase.

Fresh interest from potential buyers was relatively flat during February with a net balance of 3% more respondents reporting increases in demand.

Surveyors report that problems accessing affordable mortgage finance continue to hinder many potential first-time buyers.

New instructions saw a slight upturn with 9% more surveyors reporting instructions rose rather than fell. New stock coming to the market has now risen, albeit relatively modestly, for five successive months.

Looking ahead, a net balance of 20% more surveyors predict sales to increase over the coming three months. 

Alan Collett, a housing spokesman for RICS, says: “With the recent upturn in activity brought on by the end of the Stamp Duty holiday, it seems that a renewed sense of optimism may be slowly returning to the property market.

“Chartered surveyors’ price predictions were more optimistic in almost every area of the country in February.”

But he adds that it remains to be seen whether the optimistic outlook on sales can be sustained beyond the end of the Stamp Duty holiday, as access to mortgage finance is still holding back many first-time buyers.

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