House prices have started to increase again as buyer demand begins to pick up, according to a survey by the Royal Institution of Chartered Surveyors.
The Rics UK Residential Market survey found a modest pick up in buyer demand for the first time since February.
Results across the UK were varied, with reports of solid recoveries in some parts of the country but stable trends in others.
But despite this pick-up the number of new instructions fell again, continuing a pattern that began in mid 2014, with the average level of stock on estate agents books remaining close to historic lows.
Simon Rubinsohn, Rics chief economist, said: “The market does now appear to be settling down following the significant headwinds encountered through the spring and summer.
The market does now appear to be settling down following the significant headwinds encountered through the spring and summer.“Buyers do appear to be returning, albeit relatively slowly, but the big issue that continues to be highlighted by respondents is the lack of fresh stock on the market.
“Although this is not a new story, it is a significant one having ramifications for both prices and the level of turnover.
“Central London remains something of an outlier with contributors telling us this is the one part of the market where there may be further give on prices in the near term. Elsewhere the price trend still seems on the up.”
The drop in housing supply alongside the increase in buyer demand is expected to push up prices in the near and longer term, the survey found.
The net balance shows prices crept up in September, with 17 per cent more chartered surveyors reporting an increase in prices than a fall.
Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said: “The constriction of supply likely partly reflects many existing homeowners not wishing to incur high moving costs at a time when the economic outlook is uncertain.
“As a result, prices now are rising again, albeit at a more subdued rate than before the referendum.
“The regional picture remains diverse, however, with surveyors in London continuing to report falling prices, and expecting them to fall further over the next three months.”
