Chartered surveyors’ expectations for future house price growth were at their highest level in over 14 years during November, according to the Royal Institution of Chartered Surveyors.
RICS says 59 per cent more surveyors predict prices to continue upwards rather than fall back over the coming three months – the highest reading since September 1999.
Meanwhile, 58 per cent more respondents to RICS latest residential market survey reported price growth in November, up slightly from 57 per cent in October.
Moreover, each region of the UK saw price rises for the second successive month, a sign that the regional markets are responding to Government incentives such as Funding for Lending and the Help to Buy scheme, says the professional body.
During the three months to November, the average number of homes sold per surveyor hit 20.6, a significant improvement on the same period last year when respondents were selling just 15.9. A record 76 per cent of surveyors expect sales to increase in the New Year.
While house prices and transaction numbers seem to be recovering, RICS warns a chronic under supply of new homes will continue to make housing more unaffordable.
RICS chief economist Simon Rubinsohn says: “It’s no secret that the housing market is on the way up and prices are surging ahead in many parts of the country. The Bank of England’s recent decision to withdraw the Funding for Lending scheme – which allows banks to borrow more cheaply and pass the benefits on to mortgage applicants – could well have some impact on the number of people able to purchase a home. Although the improvement in wholesale and retail funding markets may mean the impact on mortgages is relatively limited.
“One thing we are very concerned about, however, is the lack of both new and existing homes coming on to the market. As the Chancellor pointed out last week, housebuilding is on the up but it is rising nowhere near quickly enough to make up the shortfall that has built up in recent years.”
Capital Economics chief property economist Ed Stansfield says: “While buyer interest continues to build, sellers are reluctant to return to the market. A growing disparity between the number of active buyers and sellers does not seem a healthy basis for the upturn in house prices or house price expectations.”