House prices in the UK are experiencing a notable increase for the first time in two years, according to a recent report by surveyors. Professionals have reported a balance of 16% seeing prices rise in September, marking a positive shift from the stagnant 0% recorded in August and the first optimistic reading since October 2022. The Royal Institution of Chartered Surveyors (Rics) also highlighted growth in demand, sales, and new listings during the same period.
In September, a net balance of 14% of property experts observed an increase in buyer demand, while an overall balance of 5% noted a rise in sales rather than a decline. Looking ahead, 23% expect further increases in the next three months, with 45% predicting a rise over the next 12 months. Additionally, a balance of 22% of professionals reported a surge in new property listings.
The report attributed speculation over a potential capital gains tax increase as a driver for some individuals to list their properties for sale. Tarrant Parsons, Rics head of market analytics, expressed optimism for the market due to the easing of mortgage interest rates and anticipated monetary policy changes in the coming months that may create a more favourable environment for the housing market.
In the lettings market, Rics noted that demand continues to outstrip supply, with professionals reporting a decrease in property supply alongside an increase in tenant demand. This trend has been influenced by landlords listing their properties for sale in anticipation of potential capital gains tax hikes.
According to property website Zoopla, the average cost of a UK home is currently around £300 per square foot. Regional variations were highlighted, with Hartlepool recording the lowest cost at £118 per square foot, while Kensington and Chelsea in London topped the list as the most expensive area at £1,373 per square foot. The data provided by Zoopla showcased the diverse costs per square foot across different regions of the UK.
Commenting on the findings, Zoopla’s senior property researcher, Izabella Lubowiecka, emphasized the importance of considering the square footage of a property when assessing its value, especially in terms of meeting individual space requirements and cost-effectiveness.
Rics president Tina Paillet addressed the challenges faced by renters, with demand consistently surpassing supply. While highlighting ongoing efforts to improve standards and protections for tenants, Paillet stressed the need to ensure reforms do not deter responsible landlords from participating in the market.
The recent reports on the rising house prices and evolving trends in the UK property market come against the backdrop of a dynamic economic landscape and changing consumer preferences, underscoring the significance of staying informed and adaptive in the real estate sector.