House prices ease on weaker consumer confidence - Rics

(Sharecast News) - House prices weakened in May, a closely-watched industry survey showed on Thursday, as consumer sentiment faltered.

According to the latest residential market survey from the Royal Institution of Chartered Surveyors, the house price balance was -8 in May, down on April's -3.

A net balance is the proportion of respondents reporting a rise in prices minus those seeing a decline.

A balance of -26 also reported a fall in new buyer enquiries, the fifth consecutive month of declines although it was a marginal improvement on April's -32.

Agreed sales edged lower, down two points at -28.

Tarrant Parsons, senior economist at Rics, said sentiment across the market remained "somewhat subdued".

He continued: "Ongoing uncertainty around global trade policies and the dampening effect of transactions being brought forward ahead of stamp duty changes at the end of March continue to weigh on buyer activity."

However, looking forward and respondents were more positive. Sales expectations for the next three months were broadly flat, while a net balance of 34 expect house prices to climb over the next year.

Parsons said: "Near-term sales expectations are showing signs of stabilisation, suggesting that while muted conditions may persist in the short term, a further deterioration appears unlikely."

Rics also welcomed recent pledges by the government to invest in housing. On Wednesday, chancellor Rachel Reeves confirmed a £39bn investment in social and council housing, as well as £10bn for Homes England, the government's housing and regeneration agency.

Simon Rubinsohn, chief economist at Rics, said the body welcomed the commitment to a "longer term affordable housing settlement. This should provide greater certainty and support more strategic delivery".