House prices look to increase by 25% as homes for sale plummet to the lowest level since records began
As the number of houses for sale in the UK falls to its lowest level in 37 years, surveyors expect the average price of homes to increase by 25% over the next five years according to the Royal Institute of Chartered Surveyors.
The only area in the UK that has seen a rise in the number of houses for sale is Scotland, while the starkest drop was seen in London and the North East.
As supply of houses has dropped steadily over the last few months, prices have risen along with demand. Indeed 10 out of the UKís 12 regions saw an increase in the number of enquiries by prospective buyers; only the South East and Wales saw interest remain more or less steady.
House prices have increased across the board, going up the quickest in the South East, North West, East Anglia and Northern Ireland.
In London, house prices have gone up for the last two months, bringing the seven months consecutive months of price drops to a sharp end.
These changes in the market come as a surprise to many who expected it to steady out as the dust of the general election settled.
Simon Rubinsohn of the Royal Institute of Chartered Surveyors (RICS) has said that while ìthere had been some hope that the removal of political uncertainty would encourage more properties onto the market but the initial indications are that this is not proving to be the case. As a result, it is hardly surprising that prices across much of the country are continuing to be squeezed higher with property set to become ever more unaffordable.î
Mr Rubinsohn added: ìIndeed the feedback we are getting in the survey, which points to prices at a headline rising by another 25% over the next five years, suggests that there is no real confidence that the measures necessary to deliver a meaningful boost to new supply will be put in place any time soon.î
Increased demand was also seen in the letting market over the last month, continuing the trend seen for five months now. Indeed there are predictions that this will continue and will lead to an increase in rents across the UK by around 3% over the next year as buying-let becomes ever more popular.
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