Housing market shows signs of recovery

Interest in properties rose in August for the third consecutive month, according to the Royal Institution of Chartered Surveyors (RICS) prompting spec

12:12 20 September 2005

Interest in properties rose in August for the third consecutive month, according to the Royal Institution of Chartered Surveyors (RICS) prompting speculation that the property market is recovering.

In its monthly housing market survey, the RICS revealed that new buyer enquiries had grown at the fastest pace since early 2004 with August's interest rate cut believed to have fuelled buyer interest.

House prices in August continued to fall, but at the slowest rate this year, while completed property sales are up for the second month in a row - rising by 7.5 per cent since February.

According to the RICS, the number of new properties on the market is at its slowest pace for a year, representing a diminishing pressure to sell, while there are also signs of a stabilisation in the market.

Its survey stated the housing market continues to be positive in London, with price rises expected in the north and north-west, Wales, Yorkshire and Humberside. However, the south-east and West Midlands have both seen a fall in surveyors' confidence from last month.

RICS spokesman Jeremy Leaf said: "Sales are up 7.5 per cent since February, indicating a return of confidence to the market.

"August's interest rate cut, together with continued employment rises, at new record levels have helped improve the demand for housing after a difficult year for the industry."

"The big question is whether the market is just stabilising or if this is the beginning of a sustained revival."