House prices in Wales continued to edge upwards, according to the latest RICS (Royal Institution of Chartered Surveyors) Residential Market Survey, but the outlook for the market has become more cautious.

A net balance of +25 percent of Welsh surveyors responding to the latest survey said that prices were up, however, this had eased back from +34 percent the previous month. Surveyors are also less optimistic about the outlook than they were, with a net balance of just +8 percent expecting prices to rise over the next three months, compared to +28 percent in March.

When it comes to sales activity, surveyors’ have also become less postive, with the net balance of respondents (-12 percent) expecting a fall in activity for the first time since May 2016. It would appear that this is in-part at least related to a lack of supply in the market. The net balance of respondents (-27 percent) said that instructions to sell (i.e. new properties coming onto the market) fell in April.

RICS Residential Spokesperson for Wales, and Director of Kelvin Francis, Cardiff, Tony Filice FRICS, says:

“It would appear that there are regional variations in the market. In hotspots like Cardiff, we are seeing increased valuations, instructions and offers received, particularly in favoured school catchment areas, for instance, where properties are selling over asking prices, with the highest demand for 2/3 bedrooms.”

Andrew Morgan of Morgan and Davies in Lampeter, said:

“It is busy, but the phones are quieter with offers. The stamp duty changes have had a detrimental effect on the second homes market”.

RICS Policy Manager, Hew Edgar, said:

“With the recent changes to the tax regime coming into force at the beginning of April, it is perhaps unsurprising that on balance surveyors expect sales activity to reduce in the three months ahead. Whilst the objective of the tax change, in wanting to support first time buyers and those operating in the lower end of the market, is commendable, the progressively higher tax liability of middle to upper priced houses is likely to reduce purchases in that market area which could, ultimately, negatively impact activity across the housing market in Wales,” he adds.

The main findings of the survey were as follows:

The headline price balance for Wales was +25% in the latest survey, meaning that 25% more surveyors said that prices rose in the past three months than those who said they fell.

The price expectations balance, at +8%, eased from +28 in March. The sales expectations balance at -12% dropped from +24 the previous month.

The new instructions to sell balance was at -27%, suggesting that the number of new properties coming onto the market fell in April.

Meanwhile, the newly agreed sales balance was at +22% suggesting that the number of newly agree sales rose last month. New buyer enquiries also rose, according to a net balance of +25% of respondents in Wales