Despite the housing market remaining downbeat in some areas of the country, house prices in Yorkshire and Humber are holding up and demand from potential buyers is rising.
Yorkshire continues to buck the trend in the wider property market, according to the August RICS Residential Market survey.
A north/south divide became more pronounced as house prices fell significantly or remained flat in places such as London, the South East and East of England – but 22 per cent of respondents in Yorkshire and Humber reported a rise in house prices during the month of August.
Even though the level of new instructions in Yorkshire and Humber continued to dwindle last month, demand from potential buyers increased with 20 per cent of agents seeing a rise in buyer enquiries, up from 10 per cent in July.
Demand from would-be buyers fell or remained flat in most other parts of the country, showing a slightly more cautious approach from property purchasers and, said RICS, is not entirely surprising in the wake of the Bank of England’s decision to increase interest rates in August alongside the broader political and economic uncertainty.
Looking ahead, more than half of Yorkshire and Humber’s agents expect to see prices rise further over the coming 12-months. This is still largely due to the current lack of available housing stock.
The survey has previously reported the lack of supply in the housing market as one of the main impediments to activity, and the latest results continue to show that the average inventory of unsold stock on estate agents’ books is still close to historic lows.
Yorkshire based Alex McNeil MRICS said: “The market has continued to be robust through the summer months with values stable and currently sustainable levels of owner/occupier demand although there continues to be a shortage of new housing stock.”
Turning to the lettings market, the latest numbers (which form a part of non-seasonally adjusted series) point to a fall in tenant demand and a lack of fresh rental stock in Yorkshire and Humber – a trend that has been emerging on the back of tax changes on Buy-to-Let properties.
A shortage of rental stock is expected to push rents higher in some areas, with 14 per cent of respondents expecting to see rents rise over the coming months.
Rents are expected to rise at a faster rate than house prices in the medium term, with average rental growth projections standing at around three per cent per annum over the next five years while prices are projected to rise by around two per cent on the same basis.
Simon Rubinsohn, RICS Chief Economist, said: “The latest RICS results highlight that in parts of the country the housing market actually remains quite firm.
“While a combination of a lack of stock and some level of uncertainty, both relating to the interest rate outlook and Brexit, has had an impact on activity in Yorkshire’s housing market, the overall picture is still encouraging. London and the South East is, as has been widely recognised, rather more challenging but it is important that this is not seen as being indicative of the wider market.”