UK House Price Balance Rises To 44% In July – RICS

The increase is the results of supply that can not keep up with demand, RICS said – adding that the number of properties coming onto the market has declined in six straight months. Rics said its members across the UK agreed the lack of properties for sale was causing a “vicious cycle, as the limited choice on offer is deterring would-be movers and therefore further restricting new instructions”.

Near term expectations for prices also continue to reflect the imbalance between demand and supply, with 41 per cent of members expecting prices to continue to rise over the next three months.

The strongest sales growth was outside London and the South East, with second-quarter sales in the North and Yorkshire & Humberside jumping 29% and 25% respectively on the previous quarter. New vendor instructions dropped back for a sixth consecutive month with a net balance of 22% of contributors reporting a decrease.

House prices in Northern Ireland are continuing to rise faster than any other UK region and are predicted to increase further, according to the latest survey.

Northern Ireland, the North West of England and East Anglia were seeing the strongest upward price momentum.

The survey showed 68% of respondents perceive current market valuations in their areas to be either around or below fair value at present.

Rics’ chief economist Simon Rubinsohn said: “This trend could be brought to a halt when base rates do eventually begin to rise but the dovish tone to the latest Bank of England Inflation Report suggests the first move will come a little later than previously thought likely and that subsequent increases will be very gradual indeed”.

Housing minister Brandon Lewis said: “Our efforts have got the country building again – new housing starts are at a seven-year high and nearly 800,000 additional homes have been delivered since the end of 2009”.

It said changes to zonal planning, dispute resolution for S106 and local plan enforcement have helped, but these alone are not a good enough strategy for increasing housing supply across all tenures. “That’s why we are committed to deliver 275,000 extra affordable homes over this parliament – the fastest rate of build for 20 years”.