UK

Property surveyors expect a rise in property sales in 2024

Property Finance

The RICS said on Thursday that its main house price balance held at -5 in April, unchanged from March, as fading possibility of an early BoE rate cut raised mortgage costs

British property surveyors expect a rise in property sales later this year, despite an ongoing drag from high borrowing costs, as the number of homes being put up for sale increased last month at the fastest pace since September 2020.

The Royal Institution of Chartered Surveyors (RICS) said on Thursday that its main house price balance held at -5 in April, unchanged from March, as fading possibility of an early BoE rate cut raised mortgage costs.

But there were signs of a growing volume of transactions, chiming with BoE data last week which showed a 20% annual increase in mortgage approvals in March to an 18-month high.

RICS’ aggregate sales balance increased to its highest since May 2021 in April, although the net balance for new buyer enquiries dropped below zero for the first time in four months.

A modest back up in mortgage pricing has contributed to the flatlining in the buyer enquiries metric over the past month, according to RICS Chief Economist Simon Rubinsohn.

That said, there is still a strong perception that activity in the market will pick up in the latter part of the year and into 2025, irrespective of any political uncertainty around the general election, he added.

House purchases dropped sharply after former Prime Minister Liz Truss’ budget plans spooked lending markets in September 2022, and prices dropped following a 25% increase since the start of the COVID-19 pandemic.

Truss’ successor, Rishi Sunak, must hold a national election no later than January 2025.

Mortgage lender Halifax said on Tuesday that prices had plateaued since the beginning of the year.

Economists expect the Bank of England to keep its main interest rate at a 16-year high of 5.25% later on Thursday, but many think a first rate cut could come as soon as next month as consumer price inflation returns to its 2% target.

Disclaimer: The opinions expressed by our writers are their own and do not represent the views of Invest for Property. The information provided on Invest for Property is intended for informational purposes only. Invest for Property is not liable for any financial losses incurred. Conduct your own research by contacting financial experts before making any investment decisions.

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