House sales increased in April, new research from the Royal Institute of Chartered Surveyors (RICS) announced today (12th May, 2009).

House sales edged up a little further, albeit from historically low levels, while the net balance of surveyors reporting a rise in new buyer enquires climbed to the highest figure for almost a decade, the research shows.

UK House Price Trends – House Price News – Latest Housing Market News

New enquiries in the market increased for the sixth consecutive month. 41 percent more Chartered Surveyors reported a rise in new buyer enquiries up from 32 percent in March and the highest figure for almost a decade.

The balance of surveyors reporting increased buyer interest in London is the second highest figure recorded since the series began. As London property prices have come down those with money to buy houses in London are increasingly sniffing out potential property bargains. 70 percent more Chartered Surveyors reported a rise than a fall in new buyer enquiries in London, up from 63 percent in March.

UK House Prices: UK Property Sales News

Some of this interest is translating into sales but transactions still remain at low levels. Surveyors sold an average of 10.6 properties over the past three months, up from 9.7. Also, the balance of newly agreed sales continued to rise and surveyors in most areas now expect this trend to continue. This is the first time that surveyors have been universally optimistic about UK property sales since August 2006.

"There are tentative signs that the market is starting to pick up but transactions remain at very low levels and we are unlikely to see significant improvement while money remains in short supply and the employment picture is uncertain,” said RICS spokesperson Jeremy Leaf on the latest housing market report.

“Transaction levels could benefit from an increase in supply but falling prices and low interest rates are discouraging sellers as is the latest change in HIPS legislation.  House prices could stabilise in the coming months but prospective purchasers - and first-time buyers particularly - will continue to encounter challenges while banks maintain current loan to value ratios and make accessibility difficult even for those who have accumulated considerable equity in their existing properties."

UK Housing Market News: Sales to Stock Ratio

It is also noteworthy that the sales to stock ratio - widely viewed as a key gauge of market slack - has risen for the fourth consecutive month, according to the RICS report, indicating that some stabilisation in house prices may occur later in the year. In fact, the net balance of surveyors reporting house price falls eased again. 59.9 percent more Chartered Surveyors reported a fall than rise in house prices, from 72.1 percent in March.

Despite a deteriorating employment picture, the net balance of surveyors reporting new instructions to sell remains in negative territory indicating that supply is still very tight. Falling prices and subdued activity may still be discouraging potential vendors from putting property on the market. Meanwhile low interest rates are limiting the amount of forced sales.

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