17
Dec
House prices rise as property shortage persists
House prices are still being driven up by a relative shortage of
properties for sale, says the Royal Institution of Chartered
Surveyors (Rics).
Its latest monthly survey, for November, suggests that prices
have risen for the fourth month in a row.
The number of surveyors reporting price rises outstripped those
reporting falls, with a positive balance of 35%.
Separate government figures showed that UK house prices rose by
2.3% in the three months to October.
Supply shortage
Rics carries out its assessment of the state of the market by
asking its members a series of questions about prices, supply and
demand.
It said the latest figures were the strongest reading since
November 2006 and said the trend was likely to continue.
"For the fourth month in a row, the survey points towards prices
rising, even though the general state of the economy would suggest
that the housing market should not be faring as well as it is,"
said Rics spokesman Ian Perry.
"Despite modest increases in the number of properties coming on
to the market, it is clear that this is not significant enough to
keep pace with the levels of demand.
"Buyer enquiries are continuing to grow and with the pace of job
losses now easing, the risk is that the new year could see a
further wave of interest in the market," he added.
New instructions to sell have risen for six consecutive months,
but they have been outstripped by extra enquiries from potential
new buyers.
'Modest pace'
The proportion of surveyors reporting an increase in new sellers
instructions outweighed those reporting a fall, by 18%.
But the balance in favour of those reporting more enquiries from
potential new buyers was much stronger at 28%, although this was
down a bit from the 30% balance recorded the previous month in
October.
"It is still indicative of an increasing level of buyer interest
in the market," Rics said.
"The implication of the latest set of results is that fresh
supply of stock is continuing to lag behind the increase in
demand.
"[This] provides further evidence that most housing market
activity indicators continue to improve, albeit at a more modest
pace than in previous months," Rics added.
Once again prices seem to be rising fastest in London and the
south-east of England.
"This month has seen an increase in genuine applicants wishing
to purchase resulting in a larger volume of sales," said Stephen
Whitley of surveyors R. Whitley in West Drayton.
John King, of surveyors Quinton Scott in Wimbledon, said: "The
high level of buyer enquiries covering a wide price range has
increased sale activity only held back by the lack of stock."
Price survey
In a separate survey, figures from the Department for
Communities and Local Government showed that UK house prices were
2.2% lower in October than the same month a year earlier, but 0.5%
higher than in September 2009.
This pushed up the price of the average UK home to
£198,450.
The uplift in prices has pushed the annual change in Scotland
into positive territory. Year-on-year prices rose by 0.7% in
Scotland, compared with falls of 2.1% in England, 4.5% in Wales,
and 14.8% in Northern Ireland.
Annual average house prices paid by first-time buyers in October
2009 were 0.1% lower than a year ago. However, average house prices
paid by former owner-occupiers were 3% lower.
"The property market does not exist in a vacuum and cannot
disconnect entirely from its immediate environment," said Catherine
Penman, head of research at property consultancy Carter Jonas.
"Prices are likely to remain stable in 2010, especially prior to
the general election, when caution will remain the watchword.
Certain properties, however, will continue to defy market
conditions and sell well, in many cases at 2007 levels."
source: www.bbc.co.uk/news Thursday
17th December 2009