House prices rise despite increase in property supply

An increase in the supply of properties is failing to halt rising house prices, new data from the Royal Institute of Chartered Surveyors has revealed.

The RICS Housing Market survey, published today, shows that demand is still outstripping supply, with 28% more surveyors stating that enquiries from potential purchasers are rising rather than falling.

Meanwhile, the majority of surveyors have reported rising prices for the fourth month in a row.

The sales to stock ratio, a measure of market slack and a lead indicator of future prices, has continued to climb, rising for the twelfth consecutive month.

However, the RICS warned that though the latest survey suggested key indicators were continuing to improve, the pace of the improvements appeared to be slowing.

In particular, it noted that the number of respondents feeling positive about the outlook of prices dropped slightly – from 31% of chartered surveyors believing prices would rise rather than fall over the next three months in October, to 28% saying the same in November.

London and the south east continue to be the most buoyant regions, the RICS said, with buyer enquiries remaining strong against subdued levels of instructions, and prices continuing to rise.

Commenting on the survey, Ian Perry, RICS spokesperson said: “For the fourth month in a row, the survey points towards prices rising, even though the general state of the economy would suggest that the housing market should not be faring as well as it is.

“Despite modest increases in the number of properties coming on to the market, it is clear that this is not significant enough to keep pace with the levels of demand. Buyer enquiries are continuing to grow and with the pace of job losses now easing, the risk is that the new year could see a further wave of interest in the market.”