Uk House Prices Rising?
An interesting report out this week from the Royal Institute for Chartered Surveyors (Rics) suggests that house prices are still being driven up by a relative shortage of properties for sale.
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.
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 a Rics spokesman.
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.
New instructions to sell have risen for six consecutive months, but they have been outstripped by extra enquiries from potential new buyers.
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.
Once again prices seem to be rising fastest in London and the South-East of England.
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.
Prices are likely to remain stable in 2010, especially prior to the general election, when caution will remain the watchword. Many financial markets will remain jittery until a Conservative victory is certain. Some properties, however, will continue to defy market conditions and sell well, in many cases at 2007 levels.
