The property market has remained strong in the wake of last month?s interest rate hikes. New figures from the Royal Institute of Chartered Surveyors (RICS) show the fastest increase in new buyer enquiries since September 2003 and a fifth month of house price rises. Newly agreed sales also rose in August, according to RICS, as stronger buyer interest fed through to final transactions. ?The market is still very busy, even through normally seasonal holiday quiet period,? commented Ian Shaw, a chartered surveyor from Goldings, Grantham.
Relieved that the Bank of England?s 4.7% interest rate rise has failed to halt market growth, agents across Britain are forecasting a fruitful autumn. ?As we predicted the increase in interest rates did not dampen demand and the prospects remain good for the late summer/early autumn market,? said David Smith from Drewatt Neate in Andover.
In part the static state of available property is bolstering the market. Stocks are at a near two-year low with new instructions few and far between as the holiday season comes to an end. ?Expectations for price rises over the next three months are close to this year?s high point, and surveyors are anticipating a strong autumn selling season,? said RICS.
But if interest rates rise again, RICS admits the market will almost certainly cool ? a sentiment that property economists agree with. ?With a November rate rise still a possibility and affordability remaining stretched, we continue to expect a cooler housing market by the end of the year,? said Kelvin Davidson from Capital Economics.
August price rises were led by Scotland – at the fastest pace in two years according to the RICS figures. This was followed by London and the South East, supported by a confident City. Prices in the North West continued to rise firmly while moderate price rises were recorded in Yorkshire and Humberside. Prices were static in the West Midlands and East Midlands but sales activity has improved in both regions.
?Well priced and good quality property are still in demand and are not on the market for a long period before going under offer,? reported James Scott-Lee from Chancellors in Buckinghamshire, ?Offers are coming in very close to asking price.?