Despite a subdued September, The latest RICS Residential Market Survey reports that a net balance of 33 per cent of surveyors in Scotland expect house prices to rise over the next three months.

This is the highest this balance has been since February of 2022, and up from 15 per cent that was seen in August. A net balance of 32 per cent expect sales to increase in the same period.

With regard to prices over the past three months, a net balance of 40 per cent of respondents reported that they had risen. This is above the UK average that sits at a net balance of 11 per cent.

Supply remains a challenge in the Scottish housing market though. Respondents report that new instructions to sell fell through the month of September. This is the second consecutive month the indicator has been in negative territory.

On the demand side, a net balance of -6 per cent of Scottish surveyors report that new buyer enquiries fell through September. Although this figure remains in negative territory, it is up from -12 per cent seen in August.

On the sales front, with limited demand and supply, it’s unsurprising that surveyors in Scotland report that sales had fallen broadly flat through the end of Q3.

In the rental market, the imbalance between supply and demand prevails. A net balance of 20 per cent of respondents in Scotland noted a rise in demand, whilst a net balance of -80 per cent of Scottish surveyors reported a fall in supply coming to the market. A net balance of 40 per cent of surveyors in Scotland anticipate rents will rise through Q4.

Grant Robertson, FRICS of Allied Surveyors Scotland in Glasgow, said: “The market has been slow to pick up after the summer, primarily due to the lack of rate reduction by the Bank of England. The mixed sentiment over future changes is holding everything back.”

Craig Henderson, MRICS of Graham & Sibbald LLP in Ayrshire, added: “September has been a busy month, with instructions of home reports higher than the same month last year.

“This may be as buyers are seeking to market and sell before the festive period. Demand is still there, but buyers continue to be price sensitive.”

Discussing the rental market, Carolyn Davies, MRICS of Savills in Dumfries, said: “The continued lack of supply and landlords questioning at the end of tenancy whether to stay in the private rented sector or sell.”

Commenting on the UK picture, RICS Head of Market Analytics, Tarrant Parsons, said: “The latest survey results once again convey a brighter picture for housing market activity, with the recent easing in mortgage interest rates continuing to support a recovery in buyer demand.

“Critical for the outlook, a further unwinding in monetary policy is anticipated over the months ahead, which should create a more favourable backdrop for the market moving forward. In keeping with this idea, forward-looking sentiment data from the survey points to sales volumes gaining impetus, both in the near-term and over the next twelve months.”