The housing market in Wales continues to outperform the UK average, with surveyors reporting a busy August and expecting prices and sales activity to rise in the three months ahead, according to the RICS (Royal Institution of Chartered Surveyors) Residential Market Survey.
A net a balance of +41 percent of Welsh respondents to the latest survey said that house prices had risen since June. This was significantly above the UK-wide figure of -4 percent.
Surveyors in Wales are also increasingly optimistic about the housing market’s short-term outlook. A net balance of +28 percent of Welsh respondents expects prices to rise in the next three months, whilst a net balance of 30 percent expects sales activity to increase. Both figures are higher than in any other UK region.
This follows a relatively busy August for sales activity according to the survey. There were a higher number of newly agreed sales last month according to a net balance of +62 percent of respondents. New buyer enquiries were also higher, according to a net balance of +18 percent.
Supply constraints have been a significant factor in the market for some time, however new instructions to sell increased for the second consecutive month in August, and the indicator is at its highest level since February 2018. This suggests that more properties are coming onto the market to help meet the demand.
Looking 12-months head, surveyors remain relatively upbeat regarding prices, with a net balance of +61 percent of Welsh respondents expecting prices to be higher in a year’s time. A net balance of +8 percent expects sales activity to rise.
RICS Residential Spokesperson for Wales, and Director of Kelvin Francis, Cardiff, Tony Filice FRICS, said: “The market was surprisingly busy and active during August, despite it still being the holiday season. There were strong levels of new instructions and sales. As a result, first time buyers are often struggling to find suitable properties, because demand is exceeding supply.”
David James FRICS of James Dean in Brecon said: “It was a busy month but mostly at the lower end of the market”.
In the lettings market, the August results show tenant demand increased as a net balance of +57% of contributors in Wales cited a pick-up (non-seasonally adjusted figures), but landlord instructions remain in decline. Given the consistent imbalance between rising demand and falling supply, 29% of respondents expect to see rents rise higher over the next three months.
The main findings of the latest survey for Wales were as follows (all figures indicate the net balance of respondents):
- The headline price balance was +41% in the latest survey, indicating that house prices rose.
- The price expectations balance for the next three months was 28% suggesting that respondents expect prices to rise.
- The sales expectations balance was also in positive territory, at +30%.
- New buyer enquiries rose in August, according to the balance of respondents (+18%)
- The balance for newly agreed sales was its strongest since August 2013 at +62%.
- The number of new properties coming onto the market also rose, according to the net balance for new instructions (+21%)
- A net balance of +61% of survey respondents expects house prices to rise in the next 12 months.