Meanwhile, the key sales to stocks ratio rose for the third consecutive month, and new enquiries in the market increased for the fifth consecutive month. Around 31% more chartered surveyors reported a rise than a fall in new buyer enquiries, up from 21% in February. Interest is strong in every region with London and Wales leading the way. In the former, 63% more chartered surveyors reported a rise than a fall in new buyer enquiries, up from 46% in February. The rise in interest reflects both the drop in asking prices and the sharp fall in the cost of money. As house prices drop, those with finance are now looking to do more than window shop.
It is also noteworthy that the sales to stock ratio - widely viewed as a key gauge of market slack - has risen for the third consecutive month indicating that some stabilisation in prices may occur later in the year.
The jump in buyer enquiries is beginning to translate into sales although they remain at historically low levels. The net balance of newly agreed sales moved back into positive territory in March. Moreover, the expectation is that sales will continue to improve in all but two regions.
The balance of surveyors reporting house price falls dropped only slightly in March with 73.1% more chartered surveyors reporting a fall than rise in house prices, from 78.1% in February.
Despite a deteriorating employment picture, the net balance of surveyors reporting new instructions to sell remains in negative territory indicating that supply is still very tight. In the current market, a lack of mortgage finance and weak economic conditions are restricting the ability of many to consider the option of entering the market while many continue to be accidental landlords while they wait for the market to pick up.
Commenting, RICS spokesperson Ian Perry said: "Buyer interest is starting to gain real momentum but will remain frustrated while mortgage finance is scarce. Surveyors are optimistic that transaction levels will increase, especially for those with the finance to purchase family homes. However, accessibility for first time buyers is likely to remain difficult while loan to value ratios generally remain at current levels. The market is still in a fragile state but with demand continuing to pick up, there may be more signs of stabilisation in the coming months."