The survey shows this is the fourth consecutive month that buyer demand has risen, suggesting the recent Budget has not derailed momentum in the housing market. Rics adds that the near-term outlook for market activity also remains relatively positive, although there is some decline in expectations when it comes to future sales activity.

The survey shows house prices continued on an upward trend.  Rics’s national house price indicator posted a net balance figure of +25% in November, up from +16% the month before. Rics says this cements the upward trajectory of house price growth observed since the summer.

Most of the respondents surveyed for this report expect this trend to continue, predicting house prices will continue rising in the near term (over the next three months) as well as over the year ahead.

New buyer enquiries maintained positive momentum, recording a net balance of +12%, largely unchanged from the previous month. Rics says this highlights a “modest” but sustained recovery in buyer demand.

However, there was a fall in agreed sales volumes. In November this remained positive, with a net balance of +1%, but this was down on the +8% recorded the month before. Overall 19% of respondents anticipate an increase in sales activity over the next three months, but this is a reduced figure on the month before.

Supply-side trends were also positive, with new instructions rising for the fifth consecutive month. Nevertheless, market appraisals in November were on par with levels seen a year ago, which could signal a potential slowdown in the pipeline of new listings in the new year.

Looking across to the lettings market, Rics said that tenant demand declined slightly in November, with a net balance of –1%, marking the first decline since 2020. Rics says this may reflect seasonal factors though, as this lettings dataset is not seasonally adjusted.

Meanwhile, landlord instructions continued to fall, with a net balance of -13%, reflecting the ongoing imbalance between supply and demand in the rental sector. Despite the slower demand backdrop, rental prices are forecast to edge higher, with a net balance of +29% of respondents expecting increases in the near term.

RICS head of market analytics, Tarrant Parsons says:“Although the latest survey results continue to signal a steady improvement in buyer demand across the residential market, the broader macro-environment is likely to pose additional headwinds moving forward.

“Most significantly, the recent rise in mortgage interest rates may curtail the recovery in market activity before long, and this is reflected in the slightly less optimistic sales expectations data coming through this month.

“Measures of consumer and business confidence across the economy have deteriorated of late and, if sustained, this could begin to feed through into housing market conditions in the months ahead”.

Former Rics residential chairman and north London estate agent Jeremy Leaf says: “Sales prices have hardened partly because the Budget was not as bad as feared so some pent-up demand has been released. However, more choice, slower-than-expected falls in mortgage costs and continuing worries about the cost of living, means caution prevails. As a result, competitive asking prices are essential if sellers want to attract attention – particularly over the holiday period.

“With rentals, supply has only increased marginally whereas demand and rent levels have eased in response to affordability concerns. Those properties where rents previously increased the furthest and fastest have been particularly affected. Only realistically-priced stock is generating offers with smaller flats holding sway in the popularity stakes over larger houses.”

MT Finance director Tomer Aboody adds: “There continue to be indications of a good level of confidence in the market, which has been evident since the reduction and stability in both mortgage rates and inflation.

“Both sellers and buyers are pushing to transact, as affordability is improving. While the Budget is now behind us, its full impact has yet to be felt. However, we are hopeful that this confidence in the market continues, with further rate cuts expected in the new year and buyers and sellers perceiving it to be a good time to transact.”