Homes Shortage And Increased Demand Speeds Up Price Rises
The most recent reports from surveyors across the country have stated that House prices rose at a quicker rate in July - largely down to an increase in the amount of people wanting to buy new property and a decrease in the amount of properties that are for sale.
Over the last six months, the amount of houses that have been put up for sale on the market has continuously dropped. At the same time, the amount of people who are enquiring on new purchases has risen for four months in a row. This is according to the Royal Institution of Chartered Surveyors (Rics).
The region with the biggest dip in new property for sale was East Anglia and figures were down for 9 out of 12 of the different regions in the UK. The number of homes for sale through each member of Rics fell to an average of 47.
There is a consensus across the UK surveyors group that the shortage of properties for sale was to blame for a ìvicious cycle, as the limited choice on offer is deterring would-be movers and therefore further restricting new instructionsî.
This disproportionate relationship between supply and demand has led to predictions of continued house price rises for the next year. This has the knock on effect of increasing rent prices too due to the demand for housing.
Simon Rubinsohn, Chief Economist at Rics, said:
"More worrying still is the suspicion that the imbalance between supply and demand will lead to even stronger price gains over the next 12 months. This is also visible in the firmer pattern in the buyer inquiries series, which has now risen for four months in succession, reflecting in part a further modest easing in credit conditions.î
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