House Prices Rising At Their Fastest Since 2006, According To Surveyors

House market recovery
House market recovery

Surveyors are seeing house prices rise at their fastest pace since their 2006 peak as the market revival spreads across the country.

The number of would-be buyers looking to enter the market in July also saw the strongest growth in four years, in further signs that a recovery is "round the corner", the Royal Institution of Chartered Surveyors (Rics) said.

The West Midlands and the North East, areas which Rics said have "suffered more than most" since the market crash, experienced the biggest increases in buyer activity in July, according to the latest Rics UK housing market report.

Growth in buyer numbers was seen across the UK as the upswing in activity, which has been particularly concentrated in London and the South East, spread outwards and a balance of 53% more surveyors reported increases rather than falls in demand.

As buyer numbers strengthened, prices rose across the country for the fourth month in a row, growing at their fastest rate since the market peak of November 2006, Rics said.

Looking ahead, a balance of 35% more surveyors expect prices to continue their increase rather than fall, while 53% more surveyors expect sales to rise over the next three months.

Peter Bolton King, Rics global residential director, said: "It looks like at long last a recovery could be around the corner.

"Growth in buyer numbers and prices have been happening in some parts of the country since the beginning of the year but this is the first time that everywhere has experienced some improvement.

"It is clearly good news that those parts of the property market that were struggling are at last showing some signs of life."

Lenders, estate agents and property websites have been reporting big uplifts in activity this year following the launch of various Government schemes to unblock the housing market.

More first-time buyers have been seen entering the market and sellers also appear to be more confident about sticking close to their asking prices amid improved mortgage availability.

But fears have been raised that the initiatives must not lead to a property bubble. Particular concerns have been raised about a Government scheme called Help to Buy, which will underwrite £130 billion of low-deposit mortgage lending with state guarantees from next year.

A study released by Halifax last month found that the typical house price paid by a first-time buyer is 4.26 times their annual earnings, well above an average of 3.23 over the last 30 years.

Rics said that alongside improved buyer confidence, more potential sellers are looking to test the market. Last month saw 15% more surveyors reporting rises rather than falls in new instructions.

Seller numbers have been on the rise for the last six months - but in each of these months this has been outstripped by the rise in new buyer enquiries.

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