UK estate agents reported the most widespread increase in property coming to the market since the pandemic, according to a survey, suggesting lower interest rates are boosting sales activity.
The Royal Institution of Chartered Surveyors said on Thursday its index of new sales instructions rose to 25 in January, the ninth consecutive positive reading and the highest level since September 2020.
The index tracks the difference between the proportion of agents reporting an increase in new residential listings and those reporting a decrease.
Agents reported a shrinking number of properties coming to the market for most of the three years to 2023 as rising interest rates hit the affordability of mortgages and demand from buyers. However, the Bank of England has lowered borrowing costs three times since August 2024 and is expected to cut interest rates again this year, helping a recovery in mortgage approvals and the wider property market.
Shaun Brannen, director of the estate agency Brannen & Partners, said it was “a very strong start for the new year . . . Instructions are at very high levels”.
Separate data published earlier this month by lender Halifax showed that house prices rose more than expected to a new record high in January. The Bank of England reported last month that mortgage approvals rose in December and were up 28 per cent year on year.
While the number of instructions coming to the market “has been encouraging”, John Frost, managing director at the Frost Partnership estate agency, said “buyers are very cautious”.
The Rics index tracking agreed sales slowed in January, to a net balance of three compared with seven in December.
With rising listings and weakened sales, the survey highlighted a “noticeable” increase in estate agents’ inventories, at an average of 45 listings per branch, up from 41 a year ago.
Stock levels are also significantly higher than the record low of 34 seen in September 2022, which marked the tightest supply since Rics began tracking the data in 1978.
The outlook for home sales remained positive, with a net balance of 10 per cent of estate agents expecting an increase in sales in the next three months and a net 30 per cent expecting an increase in the year ahead.
Tarrant Parsons, Rics head of market analytics, said the latest survey showed buyer demand “lost a bit of momentum” in January but respondents continued to “envisage a slightly positive near-term outlook” for sales activity.