House prices stem declines in May, RICS survey shows

House prices stemmed their declines in May and there were other tentative signs of life in the property market, the latest monthly survey of surveyors showed.

After falling in April, prices stabilised in May, the survey showed. Estate agents questioned showed a balance of -3% reporting price rises, a broadly flat picture, compared with -7% the month before, according to the Royal Institution of Chartered Surveyors (RICS).

The number of houses put on the market turned positive for the first time in more than two years. The number of new enquiries from potential customers fell but the decline was weaker than earlier in 2018. But RICS said indications of a pickup in activity should be treated with caution.

The survey, one of the most closely watched indicators for the UK property market, showed a varied picture across the country. Prices held steady overall but sales in London and the South East continued to fall. After almost three years of solid increases the South West recorded its second month of falling prices.

Agreed sales rose firmly in only four regions – Northern Ireland, the West and East Midlands, and Scotland.

Though there was more seller interest average stocks on estate agents’ books remained close to a record low, casting doubt on the strength of any uptick in supply. The number of property appraisals fell.

In London the number of homes coming on to the market rose for the third month running and buyer demand also picked up but prices continued to fall.

Simon Rubinsohn, RICS' chief economist, said: “Although agents are suggesting that a little more supply may have come onto the market in May, some of it from the Buy to Let sector, inventory levels still remain near historic lows.

“With the run rate on appraisals continuing to track below the numbers of a year ago it is premature to conclude that a sustained upturn in available stock is imminent. Against this backdrop, it is likely that the headline picture regarding activity in the housing market will remain subdued for some months to come.”