UK house prices 'to rise by 25 per cent' in five years
06-18-2015
For sale signs
Acute shortage to make homes 'ever more unaffordable', say property valuers
UK house prices will rise 25 per cent in the next five years, becoming "ever more unaffordable", a report by surveyors has predicted.
The Royal Institution of Chartered Surveyors (Rics) says an acute shortage of homes for sale will see prices rocket. The supply of homes for sale has fallen to its lowest level since records began in January 1978.
The news appears to have dashed hopes that a "supply bounce" will materialise now that the general election has passed, says The Guardian. It was hoped that a majority Conservative government would see a flood of new homes come onto the market. But the bounce has so far failed to occur, with the north-west and London seeing the sharpest drop in instructions last month compared with April.
The average stock of houses per surveyor has fallen around 12 per cent since the start of the year – standing now at 52. A simultaneous acceleration in new buyer inquiries – the fastest rate in more than a year – saw house prices rise again in May, at a quicker pace than in the previous month.
Simon Rubinsohn, chief economist at Rics, said: "There had been some hope that the removal of political uncertainty would encourage more properties on to the market, but the initial indications are that this is not proving to be the case."
Halifax has also predicted a continuing rise. The building society's housing economist, Martin Ellis, warned that housing supply "remains extremely tight". He added: "The imbalance between supply and demand is likely to continue to push up house prices over the coming months."