House price growth accelerated in April
as the number of homes being put on the market fell to a six-year low,
research showed today.
A third of estate agents reported an increase in property values during the month, the highest level since the summer of last year, according to the Royal Institution of Chartered Surveyors.
The rise was driven by the ongoing shortage of homes for sale, with new instructions falling at their fastest rate since May 2009.
A balance of 21 per cent of estate agents reported a drop in new sellers, the eighth decline in the past nine months, with the shortage seen across the whole country.
Meanwhile, there was a slight increase in buyers, with a balance of 4 per cent of estate agents reporting a rise in new enquiries.
The mismatch between supply and demand pushed up house prices in all regions of the UK, the first time this has happened since August 2014.
There was a marked turnaround in London, where a balance of 28 per cent of estate agents reported price rises, compared with a balance of 6 per cent who recorded falls in March.
But across the UK as a whole only 16 per cent of estate agents expect house prices to rise in the next few months, although they are more confident that values will be higher in a year’s time at 72 per cent.
Meanwhile, in the rental sector demand from potential tenants showed no sign of slowing, leading to expectations of further rent rises.
RICS said while anecdotal evidence suggested some of the fall in homes being put up for sale and high tenant demand was due to uncertainty ahead of the General Election, it also reflected deeper underlying problems.
It pointed out that the downward trend in owner-occupation rates across the country was a visible sign that affordability constraints were continuing to bite, while household budgets were also being squeezed by higher rents.
It is conceivable that the decisive outcome to the election could encourage a pick-up in instructions to agents and ease some of the recent upward pressure on house prices, but it is doubtful that this will be substantive enough to provide anything more than temporary relief.
Alongside an increased flow of second hand stock, it is absolutely critical that the new government focuses on measures to boost the flow of new build.
The group called for a “coherent and coordinated” house building strategy to be put in place across all tenures.
A third of estate agents reported an increase in property values during the month, the highest level since the summer of last year, according to the Royal Institution of Chartered Surveyors.
The rise was driven by the ongoing shortage of homes for sale, with new instructions falling at their fastest rate since May 2009.
A balance of 21 per cent of estate agents reported a drop in new sellers, the eighth decline in the past nine months, with the shortage seen across the whole country.
Meanwhile, there was a slight increase in buyers, with a balance of 4 per cent of estate agents reporting a rise in new enquiries.
The mismatch between supply and demand pushed up house prices in all regions of the UK, the first time this has happened since August 2014.
There was a marked turnaround in London, where a balance of 28 per cent of estate agents reported price rises, compared with a balance of 6 per cent who recorded falls in March.
But across the UK as a whole only 16 per cent of estate agents expect house prices to rise in the next few months, although they are more confident that values will be higher in a year’s time at 72 per cent.
Meanwhile, in the rental sector demand from potential tenants showed no sign of slowing, leading to expectations of further rent rises.
RICS said while anecdotal evidence suggested some of the fall in homes being put up for sale and high tenant demand was due to uncertainty ahead of the General Election, it also reflected deeper underlying problems.
It pointed out that the downward trend in owner-occupation rates across the country was a visible sign that affordability constraints were continuing to bite, while household budgets were also being squeezed by higher rents.
It is conceivable that the decisive outcome to the election could encourage a pick-up in instructions to agents and ease some of the recent upward pressure on house prices, but it is doubtful that this will be substantive enough to provide anything more than temporary relief.
Alongside an increased flow of second hand stock, it is absolutely critical that the new government focuses on measures to boost the flow of new build.
The group called for a “coherent and coordinated” house building strategy to be put in place across all tenures.
It said this should include measures to kick-start the
supply of new homes, including addressing planning restrictions, mapping
brownfield sites and creating a housing observatory to assess the
underlying economic and social drivers of housing and provide impetus
for solutions.
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