Commercial feature

House sale prices rebounded in April, with nearly a fifth of surveyors questioned confirming an increase rather than a drop during the month – almost double the figure who said the same thing in March.

This trend was most keenly felt in London, with more than half of surveyors reporting an upsurge of almost a third from the month before. In fact, Humberside, Yorkshire and Wales are the only UK areas which haven’t seen a rise in home prices.

For much of the year so far, many potential sellers have adopted a cautious approach ahead of the general election, creating a marked divide between supply and demand. With the national poll now out of the way, more surveyors say they expect the upward trend in sales and house prices to continue.

Equally, for the first time in three months, the average number of completed sales per surveyor climbed to 17.4 in April, as the average number of properties on surveyors’ books tumbled by 6%. This shift in the ratio of stock to sales is the strongest indicator so far this year of potential inflation ahead for house sale prices.

The findings from the Royal Institution of Chartered Surveyors tally with recent figures from one of the UK’s biggest lenders, suggesting a seasonally adjusted 1% lift in home prices, pushing the annual rate of inflation into double figures for the first time in nearly three years.

This housing market snapshot from April 2010 shows the average price of a UK home has gone up by 10.5% since April 2009, to reach £167,802. However, this is still 10% below the peak reached in October 2007, and April 2009 was an especially weak month for the UK housing market.

Price rises have taken place against a backdrop of a still subdued mortgage market, with the number of mortgages across the board remaining well below pre-downturn levels. Yet there has been a decline in the numbers of cash buyers, with mortgaged transactions playing a greater role in the recovery than cash purchases.

It is thought that the low numbers of properties for sale has driven the lift in prices, rather than anything else.

Many buy-to-let landlords have been waiting for a fuller recovery in house sale prices, instead of moving or selling up, and low interest rates have helped them to do this, particularly in the buy-to-let market. A large number have seen their mortgages revert to base-rate trackers, allowing them to make more money from rents than a few years ago, and hang on to their properties rather than put them up for sale.

As ever, there are no crystal balls and no real way of telling how house prices are going to perform for the rest of 2010. One leading lender has even sounded a note of caution, for its part reporting a fall of 0.1% in April, along with a prediction that the market will stay flat. And anyone expecting a return to the late 2007 peak is likely to be disappointed.

You can research house sale prices in your area online – and find out what your property is likely to be worth – allowing you to make an informed decision on whether to move or stay put.