House prices surge as buyers seek gardens

House prices rose at the fastest pace for four years in August as buyers sought out properties with gardens or near green space, according to RICS.

A net balance of 44% of estate agents reported rising prices in RICS' monthly survey, up from 13% in July and a turnaround from May when prices were falling. Only London failed to show growth with prices more or less unchanged in the past two months.

Buyer interest, new instructions and agreed sales all rose sharply as households acted to take account of Chancellor Rishi Sunak's stamp duty holiday, the Royal Institution of Chartered Surveyors said. Sunak scrapped stamp duty on the first £500,000 of a house purchase until the end of March to support the property market during the Covid-19 crisis.

Amid the flurry of activity, near-term sales expectations are positive but the outlook over the next 12 months weakened as agents grew more concerned about the wider economic climate. After returning to growth over the summer many economists expect rising unemployment and Brexit to hit the economy later in 2020.

RICS said the pandemic had caused a lasting shift in demand towards properties with gardens or near green space as many workers opt to work from home. The survey found 83% of estate agents expecting higher demand for gardens over the next two years and 79% predicting homes near green space would be sought after.

Simon Rubinsohn, RICS' chief economist, said: "The latest RICS survey provides firm evidence of a strong uplift in activity in the housing market … The results provide a further pointer to more substantive changes taking place in household behaviour in the wake of the pandemic. Increased demand for properties with gardens and near green spaces has if anything increased since we tested the water in May."