The UK housing market conditions strengthened in August as the recent decrease in mortgage interest rates spurred demand and sales activity, the latest survey from the Royal Institution of Chartered Surveyors showed on Thursday.
The number of people looking to buy homes increased in August, with the balance rising to 15 from 4 in July.
After two years of decline, house prices started to increase in August. The house price balance rose to +1, the first positive score since October 2022. A net 14 of respondents forecast a steady rise over the next three months.
On the supply side, the number of new property listings showed a moderate rise. The corresponding balance rose to 7 from 3 in July.
RICS Chief Economist Simon Rubinsohn said the survey captures an improvement in sentiment over the past month.
However, anecdotal remarks from respondents still demonstrate the need for realistic pricing to get deals done with uncertainty both around the scope for further interest rate cuts and the likely contents of the forthcoming Budget keeping the mood in check, said Rubinsohn.
Last month, the Bank of England had lowered its benchmark rate for the first time since 2020 citing receding inflation and weaker growth momentum. The bank rate was reduced by 25 basis points to 5.00 percent from 5.25 percent, which was the highest since early 2008.