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House prices are expected to continue to rise as supply declines

New houses under construction in the UK

New houses under construction in the UK

The lack of available properties is driving up house prices, surveyors say.

As a result, a majority of members of the Royal Institution of Chartered Surveyors (RICS) believe prices will continue to rise over the next year.

Due to the decrease in supply, the number of new properties coming onto the market fell by a third in June.

But without easing demand, all parts of the UK continued to see strong increases in house prices, RICS said.

“Respondents are unanimous enough to once again underline the challenge around supply, whether in the sales or rental markets,” said Simon Rubinsohn, chief economist at RICS.

With demand increasing and supply continuing to weaken, a net balance of 83% of investigators reported an increase.

Looking ahead, a net balance of 56% expected prices to continue to rise over the next twelve months.

Tenant request

Demand from tenants increased in June, boosting the rental market and driving rents up.

A 60% net balance of surveyors noted an increase in demand, up from 48% in May.

But a shortfall in new homeowner instructions intensified with a -32% net balance from surveyors reporting a drop in supply.

Surveyors predicted that rent growth would rise slightly as a result, suggesting a 3% hike over the next twelve months, including in London, where the rental market has rebounded from a RICS assessment earlier in the year.

Strong increases

According to surveyors, there have been notable increases in homes in Yorkshire and the Humber, Northern Ireland and Wales.

York surveyor Ben Hudson said: “The busiest selling month on record with the push towards the end of June stamp duty deadline.”

In Haverfordwest Wales, Paul Lucas said: “The sales market is currently extremely dynamic with buyers moving to Pembrokeshire from England and many parts of Wales.

But London presents a different picture, said Putney surveyor Allan Fuller. “Demand from new buyers has declined, except for larger homes where demand remains strong, as opposed to apartments,” he said.

Mr Rubinsohn said the government should continue to help increase the supply of new housing.

“While the role of the credit channel and the prolonged period of ultra-low interest rates cannot be ignored, it is essential that the government is able to create the conditions to support higher levels of new construction development. in order to meet the worsening affordability challenge, “he said.

But he added that houses are “necessary for all tenures,” including social and private rents in addition to ownership.

source: news.yahoo.com

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