RICS: Scotland and Northern Ireland outperform UK housing market in January

Both saw more buyer enquiries and stronger price growth.

Scotland and Northern Ireland’s housing market outperformed the rest of the UK in January.

That’s according to the latest UK Residential Market Survey from the Royal Institution of Chartered Surveyors (RICS), which rounds up member surveyors’ views on house price trends.

It found the two had more buyer enquiries, stronger price growth and a higher level of confidence in outlook than the rest of the nation.

Meanwhile, the number of potential new buyer enquiries fell for the seventh consecutive month across England and Wales.

However, Scotland saw a rise in buyer interest with several surveyors suggesting cheaper land and building transaction tax (LBTT; the Scottish equivalent of Stamp Duty) on house purchases encouraged more first-time buyers into action.

Meanwhile Northern Ireland’s housing market saw the strongest price momentum for the fifth consecutive month, with 47% of surveyors reporting price increases in the area.

In contrast national results for England and Wales continue to signal a cooling market with price growth levelling off and just 2% more surveyors expecting prices to increase over the next three months – its slowest pace since May 2013.

What about London?

In London, RICS data shows the market continue to cool with prices, buyer enquiries and sales all falling in January 2015.

Surveyors reported "a lack of confidence in the short-term" despite longer-term sales looking more upbeat.

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Pressure in rental market subsiding

In the rental market RICS data shows 19% more respondents reported a further rise in tenant demand during the three months to January.

However, while supply seems to be dipping, there is evidence to suggest some new build rental properties are coming to the market to alleviate pressure on prices.

Surveyors’ rental price growth expectations now stand at 4.6% per year over the course of the next five years.

The verdict from RICS

Despite a month in which mortgage approvals fell to one of their lowest levels, the number of agreed sales showed a slight increase in January, up from 19.1 to 19.7.

So the 12-month surveyor forecast is more optimistic around activity levels in the future with 48% of surveyors still expecting sales to rise.

However, RICS says a number of challenges remain in the market such as ongoing affordability constraints, lack of housing stock and an air of caution in the run-up to the general election.

And it says that although housebuilding looks set to increase over the course of 2015 it will still likely fall short of demand, let alone make a dent in the historic shortfall of housing.

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