Property Shortage Keeps Prices High

Tuesday, March 16 2004

House prices are set to stick to their upward trend because of the extreme shortage of properties on the market, said the Royal Institution of Chartered Surveyors (RICS) yesterday.

As more buyers continue to come onto the market despite the rise in interest rates, demand continues to outstrip supply, and will do so into the future unless new properties even up the balance, according to the survey.

RICS Housing Spokesman Ian Perry said: ‘The February market seems to have moved right back to where it was in autumn last year, with a lack of suitable properties available. Easter is traditionally a time of year for people to put their houses on the market, but only time will tell what happens this year.’

‘We await with interest both Wednesday’s Budget and the recommendations of the Barker review which both promise the introduction of measures which will directly affect the housing market in the UK, such as stamp duty reform.’

The overall positive outlook for price rises, reinforced RICS, is supported by the low availability of property for sale as well as positive buyer activity.

Mr Perry added that RICs broadly supports the Professor Miles’ report for the Treasury on the UK’s mortgage market, which suggests that UK homeowners and the economy as a whole would benefit greatly if fixed rate mortgages became more popular.

Kate Barker’s housing review is expected to be published tomorrow morning, prior to the Chancellor’s Budget statement.