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RICS Survey: UK Residential Sector Poised for Further Recovery in 2024

The latest RICS UK Residential Market Survey for January 2024 reveals positive momentum in key indicators, signalling continued improvement in the residential property market throughout the UK.

RICS Survey: UK Residential Sector Poised for Further Recovery in 2024

Key findings from the survey include a notable uptick in buyer demand, agreed sales, and new instructions, all moving out of negative territory. Optimism regarding sales volumes over the next twelve months has also increased, buoyed by expectations of future interest rate cuts by the Bank of England.

Nationally, new buyer enquiries experienced a significant boost, rising from -3% in December to +7% in January, marking the strongest demand since February 2022. Agreed sales also saw a positive shift, with sentiments turning from negative to positive (+5%). Looking ahead, respondents anticipate further increases in sales volumes, both in the short term and over the next twelve months.

While house prices at a national level continue to decline (-18%), the pace of decline has moderated, suggesting a more stable trend, particularly in London. Similarly, regions such as Scotland and the North West of England reported a generally flat picture for prices in recent months.

In the lettings market, tenant demand increased, albeit at a more modest rate compared to previous periods. However, new landlord instructions continued to decline, indicating a persistent imbalance between supply and demand, which is expected to drive rental prices higher in the coming months.

RICS Senior Economist, Tarrant Parsons, noted the continued improvement in buyer activity, supported by easing mortgage interest rates. However, he cautioned that mortgage affordability remains a significant challenge, and any unexpected developments in inflation or interest rates could pose risks to the market's recovery.

The overall outlook for the UK housing market appears cautiously optimistic, with expectations of further activity in the months ahead, tempered by ongoing economic uncertainties.

Read the original RICS release here.


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