Property Market ‘Frozen’

Tuesday, August 17 2004

The property market has ground to a halt, according to the latest market survey from the Royal Institution of Chartered Surveyors (RICS). The figures for the three months to July indicate that price rises have slowed across most of the country. During this time, 3% more surveyors reported a rise in prices than a fall, compared to 17% in June and a recent high of 45% in March.

The survey showed that, while strong price increases were reported in the North and Scotland during July, the southern regions showed price falls. Yorkshire and Humberside reported moderate rises compared with the first half of 2004, while prices in the Midlands and East Anglia showed little change.

RICS blames the decrease in activity on the Bank of England’s recent back-to-back interest rate increases. However, thanks to the upbeat economic climate, estate agents’ confidence in future sales showed a slight improvement on June, and the outlook for house prices has also improved, with some increase in sales expected across most regions over the next three months.

RICS housing spokesman, Ian Perry, said: ‘This is a traditionally quiet time of year but still buyers and sellers are showing a noticeable air of caution. The latest indication from the Bank of England is that interest rates are unlikely to increase substantially from now until the end of the year. We expect a steady demand for property as we go into the autumn but only on those that are correctly priced.’