Recovery hopes raised as demand buoys housing market

Growing demand from potential buyers and a shortage of homes for sale helped boost the housing market in May, according to the Royal Institute for Chartered Surveyors (RICS).

In its latest housing market survey, the body says a further increase in both new buyer enquiries and sales and a reduction in the level of stocks on surveyor's books had begun to provide some support for property prices.

The number of chartered surveyors seeing an increase in new enquiries edged up again in May, with 48% reporting a rise rather than a fall.

Sales also rose from very depressed levels indicating the increase in potential buyers was steadily improving activity in the housing market.

Ian Perry, spokesman for RICS, says: "On the face of it, the housing market does appear to be close to bottoming out, with activity picking up in a material way and prices at last stabilising.

"However, it is important to remember that the lack of supply has been as important in underpinning prices as the rise in demand."

jamie.obertelli@incisivemedia.com