House prices edge up in January as first time buyers increase

House sales in the West Midlands edged up during January as an increased number of first time buyers looked to beat the stamp duty holiday, according to the Royal Institute of Chartered Surveyors .

Some 35 per cent more surveyors across the region reported rises rather than falls in newly agreed sales since the beginning of the year, according to the latest RICS UK Housing Market survey.

From March 24, first time buyers will no longer be exempt from stamp duty on properties under £250,000 and some surveyors note this has produced an increase in activity at the lower end of the market.

In light of this, respondents in the West Midlands were cautiously optimistic about prospects in the near term, as a net balance of six per cent of surveyors predicted transaction levels to pick up over the coming three months.

This represents the strongest reading since August 2010.

Michael Newey, RICS housing spokesperson, said: “It seems that some first time buyers are looking to purchase homes before the stamp duty deadline and as a result surveyors are relatively optimistic for the coming months.

“However, many problems with the market still exist and the lack of affordable mortgage finance is still preventing many from getting onto the property ladder.

“Prices are still falling across the region and expectations for future prices are also subdued.”

Fifty four per cent more surveyors have reported price falls rather than rises, and the West Midlands saw the biggest fall in prices across the country while London, once again, saw the strongest reading.

Supply remained positive during January, with 21 per cent more surveyors reporting increases rather than decreases in new homes coming onto the market.

This is the fifth consecutive positive reading for new instructions in the region.

Overall new buyer demand in the region edged up slightly in the first month of the year, with seven per cent more respondents reporting rises rather than falls in new buyer enquiries.

While a cautious optimism surrounds future transaction levels in the region, the same cannot be said for future prices.

A net balance of 32 per cent more surveyors expect prices to continue falling over the coming three months.

John Ozwell, from Hunters, Solihull, said: “We had better activity than expected in December and improved sales and listings in January.

“If the Government could give some kind of boost to the housing industry then things could get better; there is certainly interest from buyers and sellers out there.”

John Andrews, from Doolittle & Dalley, Bridgnorth, Shropshire, said: “Little new property is coming to the market, although when it does it is stimulating interest.

“New instructions are needed to help revive the property market, although many prospective buyers have limited budgets due to the current economic situation.”

Jeffrey Gregson, from Gregson Page Ltd, Worcestershire, added: “There has been a tremendous increase in enquiries and we are hoping these begin to convert into sales.”