House prices in December rose at a slower pace as the gap between supply and demand narrowed, according to the RICS UK Housing Market survey published today (January 12).
In December, 38% more chartered surveyors in the south west reported a rise rather than a fall in house prices up slightly from 37% in November and compared to 30% nationally.
The Christmas period often sees a traditional seasonal adjustment in house prices and surveyors reported only minor falls in activity. A significant majority of surveyors are still recording price increases in other areas such as London, the south east, and East Anglia. However, surveyors in the north and the midlands are seeing falls in house prices indicating that some regions are still far from recovery.
For the seventh consecutive month across the UK, more chartered surveyors are reporting that the number of new instructions is increasing rather than falling. Here in the south west, 12% more chartered surveyors reported a rise rather than a fall in new instructions, however this is down from 20% the previous month. Demand is still outstripping supply but the gap has narrowed. 13% more surveyors stated that regionally, enquiries from potential purchasers are rising rather than falling but those enquiries rose at the slowest pace since January 2009.
Other demand indicators are also losing some momentum, although they remain in positive territory. The newly agreed sales balance across the UK slipped to 22 from 24 while the sales expectations net balance dropped to six from 20.
Transaction levels remain constant. The number of sales per surveying firm is still hovering around 19 nationally and 18 in the south west for the fourth consecutive month. Meanwhile the closely watched sales to stock ratio – a measure of market slack and a lead indicator of future prices– fell back slightly.