LONDON: Britain's housing market appears to be picking up due to help from a Bank of England lending scheme, with house sales at their highest level in three years and prices broadly stable, a monthly survey showed on Tuesday.
The Royal Institution of Chartered Surveyors said that its seasonally adjusted house price balance for March rose to -1 from -7 in February - implying that roughly equal numbers of its members reported price falls and price rises over the preceding three months.
This reading is the highest since December, and exceeds all the forecasts from 11 economists polled by Reuters last week, who on average expected a reading of -5.
RICS said its members helped sell an average of 17.4 homes each in the first three months of 2013, the highest number since the first quarter of 2010.
"It seems that government's recent efforts to encourage banks to offer more affordable mortgages may now be starting to bear fruit and assist purchasers," RICS said.
In the middle of last year, the government and the Bank launched the Funding for Lending Scheme, which offers banks and building societies cheap finance if they maintain or increase net lending to households and businesses.
It has led to easier terms and conditions and lower interest rates for new mortgages, and last month Chancellor George Osborne announced further incentives for home-buyers in his annual budget statement.
The RICS survey broadly tallies with those from mortgage lenders Halifax and Nationwide, which both reported that house prices in March were around 1 percent higher than a year earlier.
RICS' members forecast further price rises to come, and the share reporting higher house prices in the three months ending in March - 21 percent on a non-seasonally adjusted basis - is the highest since June 2010.
However, Bank's mortgage lending data shows that the number of mortgage approvals remains around half the level seen before the financial crisis, and prices are also well below their pre-crisis peak in most of Britain.
Moreover, other surveys show that construction activity remains weak, and it was a major factor behind Britain's recession in the first half of 2012. - Reuters