House prices across the North West have hit a 16-year high with more and more buyers looking for properties with gardens and outdoor space.
Enquiries, sales and new instructions all continued to rise in August with people taking advantage of the stamp duty holiday continuing their search for a new home, new figures have revealed.
The Royal Institution of Chartered Surveyors (RICS) UK Residential Market Survey for August said there had been a “sharp acceleration” in house price inflation in the North West. With 73% of its member respondents reporting an increase in prices, it was the strongest reading since April 2004.
The report also revealed that 83% of surveyors foresaw demand increasing for homes with gardens and outside space over the next two years, with 79% predicting a rising demand for properties near green space.
RICS said the trend was a result of the Covid pandemic, with more and more people looking to work from home more often.
Simon Rubinsohn, RICS chief economist, said: “The latest RICS survey provides firm evidence of a strong uplift in activity in the housing market which should help support the wider economy gain traction over the coming months.
“More of a concern is the pick-up in prices which could intensify issues around affordability in some parts of the country. Disaggregated data shows demand generally to run ahead of supply.
“Meanwhile 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 garden and near green spaces has if anything increased since we tested the water in May.”
According to RICS, 64% of respondents reported an increase in buyer interest across the region over the month – however, the longer-term view remains more cautious.
BusinessLive is your home for business news from around the North West- and you can stay in touch with all the latest news from Greater Manchester, Liverpool City Region, Cheshire, Lancashire and Cumbria through our email alerts.
You can sign up to receive daily morning news bulletins from every region we cover and to weekly email bulletins covering key economic sectors from manufacturing to technology and enterprise. And we’ll send out breaking news alerts for any stories we think you can’t miss.
By bringing together North West coverage with that from across Reach’s titles in England and Wales, BusinessLive will shine a spotlight on the entrepreneurs, the stars of the future and the small firms that are the backbone of our economy.
Visit our email preference centre to sign up to all the latest news from BusinessLive.
As buyer enquiries continued to rise, the number of new properties listed for sale also increased, with 32% of survey participants noting an increase in vendors listing property to sell.
Consequently, strong growth in agreed sales was recorded for a third successive month, with 55% of contributors seeing a pick-up.
Near-term sales expectations for the North West remain positive, RICS said, but 12-month sales projections are flat, coming in at 0% (up from -8% last time).
Anecdotal evidence showed concerns over the broader economic climate were behind the “subdued assessment”.
In the lettings market, tenant demand continued to rise sharply in the North West, as landlord instructions also improved for the second consecutive month.
Rental growth expectations over the near term continue to strengthen, with over 50% of contributors now anticipating an increase.
James Forrester, managing director of Barrows and Forrester, which covers various regions including Manchester, said the Government’s “well-intentioned” decision to ban tenant evictions has “effectively led landlords to prop up the rental sector”.
He said the “ironic consequence” of that is that landlords must now tread carefully, adding: “As a result, stock entering the market remains flat while demand from tenants who can pay their way continues to increase.
“With demand for rental homes already outstripping supply, this further imbalance is likely to see rental prices climb ever higher, potentially causing even more tenants to find themselves in financial difficulty.
“It’s important to remember that most landlords are individuals, not corporate giants. Having received little support, they are now struggling while shouldering the burden of a Government that once again seems hell-bent on persecuting the property-owning class.
“Until more is done to aid them through this challenging phase, who can blame them for sitting on the sideline rather than risking months of potential lost income and laborious court proceedings.”