House sales activity in the West Midlands showed clear signs of improvement at the start of the year, according to new figures from the RICS.
The institution yesterday said the number of chartered surveyors reporting a fall in prices dropped from 49 per cent in November to just 17 per cent last month.
However, only two per cent reported an increase in prices during December, down on the previous month's figure of six per cent.
Richard Franklin, RICS spokesperson and head of residential development at property firm Savills, said: "After an unseasonably busy December, the market had a stronger start in early January and has continued to move forward with pace.
"As the year unfolds we may see a significant increase in the number of properties coming on to the market ahead of the introduction of Home Inspection Packs in 2007.
"Vendors who have been deliberating about selling up may wish to stick with a system they know and get their home on to the market this year."
He added: "It is hoped that 2006 will bring a first to the West Midlands with the sale of the first £1 million apartment.
"As the city living market continues to mature and prosper, recent developments in Birmingham, such as Beetham Tower, may see the second city achieve this significant goal.
"The recent turnaround by Gordon Brown on SIPPs will of course have an impact on the residential market, but upcoming legislation on REITs may help to soften the blow and help reassure developers and investors.
"Other factors affecting the market in 2006 will be the possible drop in interest rates, bringing renewed spark to the market in the spring, and the continuing merger of the UK's house building industry will alter the dynamic of the new homes market throughout 2006."
Meanwhile, Bank of England governor Mervyn King yesterday described developments in the housing market as satisfactory, with activity picking up while property prices remain broadly stable.
"It's clearly the case that house prices are not rising at the rate that they were in the first half of 2004 and that's a good thing," he said.
"At present, activity in the housing market is picking up and house prices are broadly stable and that's a very satisfactory position. Let's hope we can keep it roughly there.
"If we can keep this broad stability of the economy that we've experienced now for over ten years then there shouldn't be very sharp or sudden changes in the finances of homeowners or indeed anyone else from year to year."
Mr King also said his visits to regional firms gave the impression economic growth was picking up, while prices remained contained.
