House prices rose for the second consecutive month in December following a year of falls, the Royal Institute of Chartered Surveyors (Rics) has reported.
The house price rise means the big three indicators of life in the property market – buyer activity, prices and mortgage approvals – have all shown upward trends in recent months.
“The housing market is definitely seeing signs of a recovery. We expect the positive activity at the end of last year to continue over the coming month,” said Rics residential spokesman Jeremy Leaf.
“Home buying and selling is being supported by a healthy job market and business climate, which looks set to continue for now though one potential obstacle to growth could be a shortage of available properties to meet growing demand.”
Re-mortgaging has experienced a recent boom as homeowners compare mortgage rate offers in search of the best deal. First time buyers now confident that the market will fall no further have also returned.
Issues of affordability are beginning to come to the forefront once again however, as prices at the bottom end of the market receive a boost from new homeowners and buy- to-let investors.
“First-time buyers are in an increasingly difficult position as property prices at their end of the market grow at a disproportionate rate, partially due to continued competition from buy-let investors,” added Mr Leaf.
Surveyors have also warned that in the lower reaches of the market – flats and terraced housing – supply is falling behind demand, adding to price pressures that are outstripping wage growth.
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