RICS points to stable August

The August RICS Housing Market Report showed little change from the previous month’s survey.

There was stability across all seasonally adjusted key indicators pointing to a broadly flat trend in prices at national level.

The proportion of respondents to the survey that felt prices were unchanged (in the three months to August) went up from 61% to 62%.

The net price balance was slightly less negative with a reading of -19 compared to -23 in July.

The sales to stock ratio has basically stayed stable since the spring.

The ratio is down on where it was earlier in the year but above the year on year reading.

The national figures mask some regional variations with London prices showing the only positive net price balance across the country.

Key activity indicators show new buyer enquiries have edged lower for the fourth consecutive month.

The results are broadly in line with HMRC figures showing residential transactions have slipped from on average 82k in the first three months of the year to an average of 75k in the three months to July.

The agreed sales series edged upwards in August for the first time since March but not in a strong enough manner to point to a reversal in the activity trend.

RICS believe it is still too early to judge the impact of the recently introduced Funding for Lending scheme.

The scheme has the potential to lower borrowing costs and increase access to mortgage finance.

The forward looking indicators for sales (over both a three and twelve month period) suggest that respondents to the survey are hopeful that a combination of a more stable economy and an improvement in the funding climate will help support activity.

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