"Although the mood music around interest rates does appear to be shifting, for now the stronger influence on the housing market is the ongoing imbalance between demand and supply."
In October, respondents to the monthly survey pointed to another dip in the volume of sales agreed, with the main issue being a lack of stock for would-be buyers to choose from.
Despite a rise in the number of new enquiries, agents currently only have 37 properties on their books on average.
This is not only impacting on sales activity but is a significant factor behind current house price rises. In October, 70% of respondents cited a rise in house prices, with the trend expected to continue over both the next three months and the year ahead.
Extra questions were added to the October survey to gauge consumers’ willingness to reduce their home’s carbon emissions and its impact on the market. Interestingly, whilst one-third of respondents have seen an uptick in demand for energy efficient homes, it isn’t currently impacting the property value. Over three-quarters of respondents see little to no impact of having an energy efficient property on sale prices.
Whilst 62% of respondents anticipate demand for energy efficient properties improving over the coming three years, the current barrier for many to improve enhance their property’s energy efficiency is cost (85%).
Simon Rubinsohn, RICS Chief Economist, commented: “Although the mood music around interest rates does appear to be shifting, for now the stronger influence on the housing market is the ongoing imbalance between demand and supply. The inventory on agents’ books appears to have slipped back towards historic lows and this seems to be underpinning both the current price trend and expectations for the next year. Meanwhile although there is likely to some drop in activity in the immediate aftermath of the expiry of the stamp duty break, most activity indicators currently remain solid. Indeed, the main challenge for buyers looking forward may once again be a lack of choice of property on the market.
“As long as there is a lack of choice for would-be buyers, it is clear that buyers ambition to be more climate friendly will have to move down their list of priorities. The data from today’s report suggests that additional government funding and investment alongside new financial solutions appealing to homeowners, landlords and investors could pave the way for decarbonising UK homes.”
Tomer Aboody, director of MT Finance, added: "With stock levels incredibly low, a factor which has been driving up house prices for the past year or so, there seems to be no foreseeable let-up in the continued upwards trajectory of values.
"Green issues are firmly on the agenda, with government incentives towards energy-efficient housing and growing public interest in energy efficiency and measures to reduce climate change. Homeowners are increasingly aware that they need to do more to help this agenda but the cost of doing so is still high and beyond the means of many.
"Not all options are viable either, with air source heat pumps, for example, requiring huge boxes to be placed on outside walls, which many homes don’t have space for. There are also potential noise issues associated with these pumps and less-efficient heating than you might expect from a traditional boiler.
"Until education improves, and pricing reduces as more specialist installers are trained, we are unlikely to see a limited uptake in alternative heat sources. That said, there are simple ways of making homes more energy-efficient, which aren’t as costly and are more feasible, including better insulation of walls, ceilings, lofts and windows."
