The UK housing market saw a gradual improvement in sentiment in December 2023, with three- and 12-month sales expectations picking up for a second consecutive month, revealed the latest RICS residential market survey.
According to the report, the headline net balance for new buyer enquiries indicator registered a reading of -3% in December, compared to -13% in the previous results.
In addition, the latest national net balance of -6% for the newly agreed sales measure also represents the least negative figure going back to early 2022.
Looking ahead, experts foresee a solid recovery in residential sales volumes, as well as a stabilisation in house prices at national level over the year ahead.
In the lettings market, tenant demand rose over the previous month — however, landlord instructions remained scarce in December.
On the back of the supply/demand imbalance, RICS survey respondents expect rents to continue to rise over the near term, with longer-term projections now pointing to a near 4% increase over the year ahead and for rental growth to average 5% per annum over the next five years.
In response to the latest RICS residential market data, Emma Cox, managing director of real estate at Shawbrook, said the gradual improvement in the market, failing mortgage rates and a rise in tenant demand would give landlords a confidence boost this year.
However, she emphasised that landlords may need to act quickly to close transactions and secure new properties.
“A surprise increase in inflation may prevent the anticipated interest rate cuts which, in turn, could halt the lowering of mortgage rates,” she added.
“Now could be the time for landlords to partner with a specialist lender to finalise deals and future-proof strategies against further economic challenges.”
