LONDON: House prices had risen in the three months ended December as the buoyant markets during the holiday season had helped the market, according to a study by the Royal Institution of Chartered Surveyors. It feels the price gains will continue through 2006.
RICS said its house prices balance rose to +8 in December from +4 in the three months to November. This constitutes the second consecutive monthly rise and the highest since June 2004.
It also came out statistics to show that the number of completed sales in the three months to December increased at its fastest in the last two years to 24.9 sales per surveyor, from 23 in November. The three months to December is normally the lull period for the housing market.
RICS spokesperson Jeremy Leaf said the market is definitely seeing signs of a recovery.
The sales to stock ratio, most preferred benchmark for economists, rose to 32.8 in December, its highest in over a year. However, this is still much below the RICS' long-run average of 37 per cent. The number of properties being put in the market for sale rose in December and enquiries from buyers went up for the seventh month in a row, RICS said. The rate of increase in new buyer interest slowed from a peak in October, however, said RICS, as the effect of the cut in interest rates by the Bank of England in August started waning.
Some surveyors are now worried because there are not enough properties on sale as the demand continues to rise.
RICS said London and Scotland led the price rise, while there have been modest declines in Midlands and East Anglia.
Leaf said first-time buyers are coming into the market in larger numbers, as their fears of a housing market crash have diminished.
"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-to-let investors," he said.
Posted
on : Wed, 18 Jan 2006 21:25 GMT | General News
By : Salim Patel
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