The supply of UK homes for sale rose to its strongest in over three years and the number of buyers rose for the second consecutive month after an extended decline, a survey of surveyors found.
House price rises reached their highest level since just before the disastrous Truss-Kwarteng mini-budget, according to the residential market survey from the Royal Institution for Chartered Surveyors (RICS), which revealed price balance of -10 in February.
The net instructions to sell balance rose to +21 in February, the strongest since October 2020, from +12 in January, though the new buyer enquiries balance stayed at +6.
The net balance that expected prices to rise in the next three months fell to -9 in February from -4 in January.
Estate agents' confidence in price gains over the next 12 months rose sharply, with the net balance expecting prices to rise jumping to +36 in February, the strongest since June 2022, from +18 in January.
With estate agents expecting the momentum in sellers and buyers to continue over the next few months, paired with a slight rise in mortgage rates, this means “house price gains are likely to stall in the near term,” said Andrew Wishart at Capital Economics.
However, Rob Wood at Pantheon Macroeconomics said he remains "comfortable forecasting the official measure of house prices to rise by about 5% over the final three quarters of 2024, reaching its previous peak".