Britain’s house prices are set to soar as there are more people rushing into the housing market, but not enough people are selling their homes.
According to new data from the Royal Institution of Chartered Surveyors (RICS), there has been a “significant turnaround in new buyer enquiries compared to June“when the EU referendum took place, but there is a slump in people actually putting houses on the market.
This only means one thing — there are too many people looking to buy a home and not enough to go around. Considering this is a key problem for Britain’s housing market anyway, because there is a dearth in supply and homes are not being built fast enough, this will elevate prices for some time to come.
“The market does now appear to be settling down following the significant headwinds encountered through the spring and summer. Buyers do appear to be returning, albeit relatively slowly, but the big issue that continues to be highlighted by respondents is the lack of fresh stock on the market,” said Simon Rubinsohn, chief economist at RICS.
“Although this is not a new story, it is a significant one having ramifications for both prices and the level of turnover.
Central London remains something of an outlier with contributors telling us this is the one part of the market where there may be further give on prices in the near term. Elsewhere the price trend still seems on the up.”
RICS points out that the number of new instructions being received by estate agents has hit historic lows.
“This drop in new properties coming to the market continues a pattern that extends back to the middle of 2014 with a brief exception around the turn of the year when some vendors saw opportunity linked to the April hike in stamp duty for investors,” said RICS.
And the impact on prices is over the next three months is that, nationally, they will rise. According to RICS’ UK Residential Market Survey, 14% more respondents expect to see an increase. RICS says “this is the strongest reading since March and compares with +9% in August.”
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