The number of new buyers entering the Welsh housing market rose during August, with surveyors also becoming more optimistic about the outlook for sales and house prices.
The latest Royal Institution of Chartered Surveyors Residential Market Survey found that a net balance of 44% of respondents in Wales reported an increase in new buyer enquiries.
This was the highest the balance has been in two years.
Housing supply also increased during the month. A net balance of 22% of Welsh respondents reported a rise in new instructions to sell, compared with 19% in the July survey.
With both demand and supply moving upwards, newly agreed sales also increased during August. A net balance of 50% of respondents in Wales reported a rise.
Surveyors expect the momentum to continue, with a net balance of 43% anticipating that sales will increase over the next three months.
House price outlook improves
Respondents also reported an increase in Welsh house prices during August.
A net balance of 10% said prices had risen, improving from July when the balance was reported to have remained flat.
Looking ahead, a net balance of 9% of respondents in Wales expects house prices to rise over the next three months.
Commenting on the sales market, Anthony Filice FRICS of Kelvin Francis Ltd. in Cardiff said: “Against all expectations, the market in August was very busy. There was a steady number of new instructions, and this is expected to rise further in September. Confidence amongst buyers is also holding up surprisingly well.”
On the rental market Anthony adds: “It is a steady market, but short of available properties to rent, which continues to diminish, bringing about an increase in rental values.”
UK recovery remains fragile
Commenting on the UK picture, RICS Head of Market Research and Analysis, Tarrant Parsons, said: “August’s results show a market that is gradually finding its footing, with key activity indicators having become progressively less negative over recent months. That said, any potential recovery remains fragile and faces two significant near-term tests.
“The Bank of England’s increasingly hawkish tone, on the back of renewed volatility in global energy markets, is a reminder that the borrowing cost outlook could yet deteriorate further. And with the October Budget approaching, speculation over potential changes to property taxation is adding another source of caution for both buyers and sellers. As such, headwinds over the shorter term remain pronounced, even though recent market trends have appeared more stable.”
