Prices expected to continue to increase
Little evidence that house price growth is losing momentum
'Limited supply and steady growth in demand, still overriding drivers of house prices'
There’s “little evidence” that the rate of house price growth is slowing, despite rising living costs, reports the Royal Institution of Chartered Surveyors (RICS).
It says that a limited number of available properties on the market and a steady rise in demand from buyers remain the overriding factors in driving house prices.
In a survey of property professionals in April, RICS found a net balance of 10% reported an increase in new buyer enquiries. However, in terms of supply of available properties, more professionals reported a fall in new property listings against those who reported rises in new listings in April, which indicated a flat trend in the number of new homes coming to the market.
Imbalance between demand and supply
RICS reports that due to this imbalance between demand and supply, the levels of housing stock remains extremely low.
A total of 80% of professionals reported an increase in house prices in April, up from 74% in March.
It’s reported that surveyors expect prices to continue to increase. Looking forward to the coming year, 62% predict price increases, although this has fallen from 78% in the February survey.
RICS economist Tarrant Parsons said: “Despite growing macro headwinds in the form of cost-of-living pressures and higher interest rates, the UK residential market continues to see modestly positive trends in new buyer enquiries.
“For the time being at least, even though there is a lot of caution about the future economic landscape, it seems that limited supply available on the market, coupled with steady demand growth, are still the overriding drivers of house prices.
“As such, there is little evidence at this stage of house price inflation losing much momentum, while expectations for the coming 12 months have only moderated slightly from recent highs.”
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