Surveyors predict revival in housing market confidence

Sellers are regaining the upper hand in the housing market because so few properties are being put up for sale, a study showed today.

The number of homes in England and Wales coming on to the market has stagnated as fears of a collapse in house prices recede, the Royal Institution of Chartered Surveyors (RICS) said.

And with the number of buyer inquiries at its strongest level since September, RICS said competition for properties had risen along with market confidence.

RICS housing spokesman Ian Perry said: "The balance of power remains with the purchasers but the gap is narrowing. Earlier in the year, many people were accepting up to 10 per cent below the asking price for their properties. Our research seems to indicate that this situation is showing signs of change as buyers begin to come back into the market."

RICS said 2 per cent more surveyors reported a rise in new instructions than a fall during July, down from 5 per cent in June. Stocks are also 4 per cent lower than three months earlier.

However, RICS added that 11 per cent more surveyors reported a rise in buyer inquiries than a fall, with interest higher in most regions except the Midlands. Better demand conditions meant prices were little changed in July after steady declines since February, the survey said.

All of the northern regions of England as well as Wales showed price increases, with the pace of increase accelerating in Yorkshire & Humberside for the first time since last October.

Prices fell in all the southern regions, RICS added, although the pace of decline has slowed, particularly in London.

And for the next three months, 32 per cent more surveyors expect sales to rise than fall, ensuring a rise in confidence of 6 per cent on the previous month, RICS added.

The message of the survey runs counter to two separate reports over the weekend. Rightmove, a property website that measures estate agents' asking values, said there was no price rise in the latest month.

Woolwich bank said the boost in optimism that was evident in the housing market over the past three months had evaporated.