UK Housing Market Improves Amidst Rising Interest Rates
The latest UK housing market data from the Royal Institute of Chartered Surveyors (RICS) residential market survey and from the latest Halifax House Price Index revealed surprising signs of improvement.
The key messages from these reports were as follows-
• The RICS measure for new buyer enquiries in May climbed to -18%, a significant improvement compared to the previous reading of -34% in April. However, despite a noteworthy turnaround in buyer interest over the past 12 months, the figure still suggests a relatively subdued trend in buyer demand.
• Alongside this, the agreed sales balance rose to -7% in May, also much less negative from figures of -29% and -18% recorded in March and April respectively.
• The national house price balance additional remained in negative territory but still rose to -30% in May, up from –38% in April. This was firmer than expected as the consensus forecast was centred on a net balance of -38%.
• This news chimed with yesterday’s survey of house prices from the Halifax building society. The headline house price index, for example, showed no growth in May, following a decline of 0.4% in April.
• Still, the weaker house price trend in recent months meant that UK house prices experienced their first year-on-year contraction since 2012 with a -1.0% fall in the annual rate of growth in May.
Kritika JainAuthorMore in Author Profile »
Kritika joined Haver Analytics as a Junior Economist in August 2022. She writes commentary on UK macroeconomic trends and provides client support of Haver’s data content and proprietary software.
From 2019 to 2022 Kritika worked in Financial Accounting and Capital Markets. Prior to working in financial services, she was a research assistant at Frontier Economics within the public policy practice and has also interned at HM Revenue and Customs.
Kritika holds an MA in Economics from the University of Manchester and a BA in Economics from India.