House prices rise despite election uncertainty

The latest RICS UK Housing Market survey shows that house prices rose in April, despite the uncertainty regarding the general election.

RICS’ data demonstrates that 17% more chartered surveyors reported a rise in house prices than the month before, with London leading the way – 55% of chartered surveyors in the capital reporting a rise, up from 32%. Elsewhere, surveyors are still reporting house price rises in every region except for Wales and Yorkshire and Humberside.

Activity is expected to rise over the coming months with many surveyors anticipating a post-election bounce. The sales expectations net balance rose from 6% to 25%. While the price expectations net balance rose from a negative 2% to a positive 7%.

The newly agreed sales net balance turned positive for the first time this year. 12% more surveyors saw vendors agree a sale up from a negative reading of 8% in March. The net balance on newly agreed sales in London jumped from 1% to 45% although the strongest reading was in the North West.

The average number of completed sales rose for the first time in three months to 17.4% per surveyor, while the average stock of property on surveyors’ books decreased by 6% on the month to 61 properties per surveyor. This had the effect of raising the sales to stock ratio – a key indicator of future house price inflation – from 25% in March to 28% in April. This is the first upward movement of this indicator in 2010.

A net balance of 11% of surveyors saw a rise in new instructions while new buyer enquiries rose from 1% to 8%.

Commenting, RICS spokesperson, Jeremy Leaf said:

“For much of 2010, the housing market has been under the shadow of the general election with the gap between supply and demand growing wider as potential house buyers opted to stand on the sidelines awaiting the outcome of the poll. However, the start of spring has seen renewed optimism with the good weather improving sentiment and surveyors expecting an increase in both sales and house prices. The housing market often sees an increase in new instructions in the early part of the year with sales boosted in the spring and this year has been no exception.”