Spring bounce-back begins with sharp rise in homes for sale

Activity picked up in the Scottish housing market last month as more sellers put their homes on the market, according to a report out today.

A rise in the number of homes for sale was accompanied by increases in both agreed sales and inquiries from potential buyers, the latest monthly snapshot from the Royal Institution of Chartered Surveyors (Rics) Scotland reveals.

Scotland saw the biggest hike in the number of properties going on the market and the sharpest increase in inquiries from interested buyers of any nation or region of the UK last month, surveyors said.

But while more Scottish surveyors reported a rise in house prices than saw a fall in March, the majority expect sales levels to remain flat or edge up only very slightly over the coming months.

Graeme Hartley, director of Rics Scotland, said: "Scotland's housing market is a very different picture to the rest of the UK, where many parts are suffering from a lack of buyers and sellers.

"Scotland is seeing a typical rise in buyers and sellers now that spring is here, but chartered surveyors are reporting that sales will remain flat or only rise modestly in coming months."

The reluctance of sellers to reduce their asking prices continues to be an issue at the lower end of the market, where first-time buyers still face steep deposit requirements, surveyors reported.

Chris Highton, of Allied Surveyors in Selkirk, said: "The lower end is still a problem. It is clear with published house-price figures that the average values are at odds with actual values.

"This is because very little is selling at the bottom end of the market, leading to an increase in the average figures. Actual prices are not, however, increasing."

Two of the UK's biggest lenders, Nationwide and Halifax, have warned in recent days that housing demand for at least the remainder of 2011 will be restricted by concerns over the economic outlook and growing pressure on household budgets, with prices moving sideways or modestly lower as a result.

However, in Edinburgh several solicitors and estate agents have reported an improvement in recent weeks, including Robert Carroll, managing director of MOV8 Real Estate.

"What has been heartening is that, in some weeks, the number of properties selling has been almost as many as the number of new properties coming to the market, hinting at an increase in demand compared to supply," he said.

Michael Maloco, of estate agents and solicitors Maloco and Associates in Dunfermline, said that, while there was evidence of a spring bounce, the market was struggling to recover.

"We were coming from such a low level of activity, after what was effectively a weather-enforced shutdown in late November, December and early January that any uplift was going to be both welcome and significant," he said."In terms of historic volumes, the West Fife market is still about 50 per cent below the 2007 high."