The latest RICS Residential Survey has sparked optimism among house buyers and sellers, though tenants may face a more challenging market.
According to the survey, which gathers insights from estate agents on the housing market, there has been a "sustained improvement in market activity", with positive trends in demand, sales, and new listings, as reported by .
This marks the third consecutive report with a positive demand indicator.
Estate agents are anticipating an increase in sales over the next few months even amid concerns about the budget and predict growth in the market throughout the year.
Tomer Aboody, director of MT Finance, commented: "With lower rates and potentially a further cut in base rate on the way, buyers are feeling more confident about taking the plunge."
"Although property prices are rising, we need to remember that they're increasing against a lower benchmark from 2022 following the adverse market reaction to Liz Truss' ill-advised Budget."
"Talking of budgets, we await to see what Rachel Reeves will deliver later this month, but very few are holding their breath for a positive outcome."
Kathleen Brooks, research director at XTB, noted that despite the "uptrend in housing in the last few months", a slowdown in some sub-indices such as sales expectations, price expectations, and new buyer enquiries suggests that some º£½ÇÊÓƵ consumers might be "holding back on big ticket purchases like houses until after the budget".
Tenants are bracing for further difficulties as the housing sales market shows signs of improvement, with the lettings sector experiencing a tightening trend. The latest survey data indicates a persistent rise in demand coupled with a decrease in supply.
In September, a net positive balance of 22% of respondents noted an uptick in interest from potential tenants, while the ongoing reduction in new landlord instructions is likely to exert upward pressure on rental prices.
The disparity between the demand and supply of rental properties worsened, with the net balance dropping to -29%, down from -21% in August. The Royal Institution of Chartered Surveyors (RICS) has issued a warning that this imbalance is set to drive up rents, with the expectation among 39% of survey participants that rental costs will climb over the next quarter, mirroring the forecast from the previous month.
Commenting on the situation, Jeremy Leaf, a north London estate agent and former RICS residential chairman, remarked: "The unfortunate loss of too many good landlords from the private rented sector without being replaced in sufficient numbers has meant choice for the steady increase in tenants is limited, resulting in hardening rents."
Leaf also highlighted potential future shifts, saying: "When the implications of the Renters' Rights Bill are more fully appreciated as it passes through Parliament, other landlords may follow suit if unable to sell before the expected CGT increase in the Budget."
He added a note on local observations: "However, in our offices we have noticed affordability concerns are weighing heavily on tenants so a significant proportion are simply unable to afford to pay much more."
"Therefore, renewals are up and landlords remaining in the sector are insisting on even stricter references before proceeding."
