The seemingly inexhaustible demand for property meant that house prices continued to rise last month, despite a fresh supply of stock coming on to the housing market.
The proportion of estate agents reporting an increase rather than a decrease in house prices was at its highest for three years, according to figures from the Royal Institution of Chartered Surveyors (RICS).
The figures show that 35 per cent of surveyors reported rising rather than falling prices in the past three months, up from 34 per cent in October and the highest quarterly reading since November 2006.
This is further evidence that the recovery has not faltered as expected in the run-up to Christmas. New instructions rose for the sixth straight month in November as higher house prices made sellers feel more comfortable about marketing their homes.
Even as prices rise, the demand for property is going up. RICS said that the balance of surveyors reporting an increase rather than a decrease in new buyer inquiries slipped 2 per cent to 28 per cent in November. While this was lower than the 66 per cent that was recorded in June, it still represented a rise in buyer interest, RICS said.
A spokesman for RICS said: “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 inquiries 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.”
More evidence of higher levels of confidence among estate agents came yesterday as Marsh & Parsons, a London-based agent, forecast that prices in the capital would rise by up to 7 per cent next year, even with the clampdown on City bonuses, as a result of interest from overseas investors. This contrasts with predictions of flat growth, or even slight price falls, from market commentators.
Cluttons, another London estate agent, reported that December had been “unseasonally busy”. James Hyman, partner for residential sales, said: “This has to be one of the best Decembers we have experienced in many years and could well be a record. We are experiencing a higher volume of agreed sales than at any other time this year.”
Despite the apparent return to health of the housing market, Shelter, the homelessness charity, said that measures introduced to help borrowers facing repossession must be strengthened. A report by Shelter, AdviceUK and the Citizens Advice Bureau said that, while some homeowners were being helped by government schemes, there were “gaps” in the net and “too many homeowners are falling through”.
Hard to get consent for new homes
• It is easier to demolish a listed building than to gain consent for a new housing development, a study of planning approvals has found
Analysis of Department for Communities and Local Government (DCLG) data showed that two thirds of planning applications for residential developments were approved in the year to June 30, against 85 per cent of applications to demolish listed buildings.
Giles Ferin, of EMW Picton Howell, the law firm behind the study, said: “With such a shortage of houses in the UK it is surprising to see how difficult it is for developers to win planning permission for residential developments relative to other types of planning application.”
The DCLG figures show that planning applications to build industrial property have the highest rate of approval, at 91 per cent.
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