The Royal Institution of Chartered Surveyors (RICS) said its house price net balance - which measures the difference between the percentage of surveyors seeing rises and falls in house prices - fell to -43 last month, up from -47 in February, and slightly above the -48 forecast in a Reuters poll of economists. RICS's gauges of buyer demand, sales, new listings and house prices were all in negative territory last month. The net balance of agreed sales across Britain slipped to -31 in March from -25 for February, but still above the -43 low in October 2022 when financial market turmoil after former prime minister Liz Truss's mini-budget temporarily halted new mortgage lending.
However, its indicators looking ahead pointed to hints of stability in Britain's housing market in the coming 12 months. The sales expectations balance for 12 months' time rose to +1, its highest since March 2022. "The overall tone of the feedback received from respondents ... is still one of caution towards the sales market, which is reflected in both the headline price and activity indicators," Simon Rubinsohn, RICS's chief economist, said.
"There is also a sense that the medium-term outlook is looking a little more settled, helped by the perception that the interest rate cycle may be near the peak." The Bank of England raised interest rates by a quarter point to 4.25% last month in an effort to bring back double-digit inflation to its 2% target, but has hinted it is nearing the end of its run of rate hikes which began in December 2021.
Other measures of Britain's housing market have shown a
mixed picture. Mortgage lender Nationwide reported a 3.1% drop
in house prices in the year to March - the fastest annual fall
since July 2009 - while rival Halifax said prices grew 1.6%
year-on-year.
In contrast to property price falls, RICS said rents are
expected to rise 4% across Britain in the coming 12 months due
to an imbalance in demand and supply.
Its non-seasonally adjusted monthly tenant demand growth
indicator hit a five-month high, with a net balance of +46.
Rubinsohn said the rental market remains hugely constrained
by the lack of homes to rent.
(Reporting by Suban Abdulla; editing by David Milliken)
