(Bloomberg) -- Britain’s property surveyors for the first time in a year are anticipating sales will increase, and their outlook for prices is at the strongest it’s been since September.
The findings from the Royal Institution for Chartered Surveyors indicates strength returning to the residential property market after months of gloom triggered by a sharp jump in interest rates. The reading contrasts with data from the lender Nationwide Building Society showing prices dropping the most since 2009.
RICS, which collects the views of surveyors who evaluate property as it’s put up for sale, said the market is stabilizing with signals that the Bank of England may be near an end of its quickest series of rate hikes in three decades.
“The medium-term outlook is looking a little more settled, helped by the perception that the interest rate cycle may be near the peak,” Simon Rubinsohn, RICS chief economist, said in a statement Thursday.
The survey indicated national house prices continued to fall in March, with a net balance of 43% of respondents reporting a decline. That was less negative than the reading of minus 47% in February.
“You could say they’re downbeat, they’re just a little less so, so there is a bit more confidence that this isn’t going to be a hard landing for the property market,” Rubinsohn said in an interview on Bloomberg Radio. “The overall mood in the sector is still a little bit cautious.”
The outlook for prices over the next year rose to minus 24%, which was the strongest since September. RICS said a balance of 1% of those surveyed said sales would rise in the next year, the first positive reading since March 2022.
“Expectations of falling interest rates later in the year have persuaded agents that we could see sales pick up again in the next 12 months,” said Sarah Coles head of personal finance at Hargreaves Lansdown Plc. “However, it’s the one bright spot in a tricky market for sellers.”
The report also showed:
- New buyer inquiries, agreed sales and new listings fell in March.
- Prices are expected to fall in coming months, before leveling out in London and rising in Northern Ireland, Scotland and Wales in 12 months time.
- Squeeze on rental market continues with a lack of supply of properties to let and a rising number of tenants. Rents are expected to increase 4% in the next year.
--With assistance from Lizzy Burden.
(Updates with comment from radio interview.)
©2023 Bloomberg L.P.
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