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Economy in Brief

  English and Welsh Housing Market Shows Improvement 
by Louise Curley April 18, 2006

The housing market in England and Wales is showing improvement. The RICS (Royal Institute of Chartered Surveyors) survey of the housing market shows that although the pace has slackened, house prices continue to rise and expectations of price increases are becoming stronger as can be seen in the first chart.

The RICS survey, which was released today is an excellent source of information on many aspects of the housing market in England and Wales. It is found in Haver's UK data base and in INTSRVYS-G10+ Country Surveys.

There are data on the average units sold and the average stock of units held per chartered surveyor and the relation of sales to stocks. The average units sold has improved and in March was 16.4% above the units sold in March 2005. Over the same period the stock of units held has declined by 5.9%. The second chart shows the year over year percentage change in the average units sold and the average stock of units per chartered surveyor. Although we do not have the absolute levels of sales and stocks of housing units, the rising trend of sales and declining trend of stocks suggests an improving supply and demand situation.

The same sort of relative improvement in the housing market can be seen in the year to year difference in the percent balances of new buyer enquiries and the new offerings by sellers. (See the third chart.) The year to year difference in the percent balance of new buyer enquiries has been positive since early 2005, while the year to year difference in the percent balance on new offering by sellers has been negative.

England and Wales:
RICS Survey
Mar 06 Feb 06 Mar 05 M/M % Y/Y % 2004 2003  2002  
Units
Average Stock per Surveyor 72.2 71.7 76.7 0.70 -5.87 75.8 64.1 70.1
Average Sales per Surveyor 25.5 24.9 21.9 2.41 16.44 22.5 28.5 30.7
Percent Balance Mar 06 Feb 06 Mar 05 M/M dif Y/Y dif 2004 2003 2002
Actual House Prices  11 10 -7 1 18 6 -12 -5
Expected House Prices 27 24  -28  55  -8 
Expected Sales next 3 months 28 24 24 4 4 28 19 18
Newly Agreed Sales 17 12 -7 5 24 2 -9 -2
New Buyer Enquiries 11 10 -7 1 18 6 -12 -5
New Stock 13 8 18 5 -5 11 10 8
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