Lack of supply continues to push up house prices

New buyer enquiries remained high in July with a net balance of 63% reporting a rise rather than a fall; this is marginally lower than the previous month but still indicative of a growing level of interest in the market.

At the same time the levels of stock on estate agents’ books remains very low.

A positive net balance of just 2% suggests that vendors are still a little reluctant to put properties on the market.

RICS spokesperson Jeremy Leaf said: "Although demand for property is continuing to rebound, it still remains low from a historical perspective. Crucially it is the lack of supply that is helping to underpin prices at the present time.

"Significantly, the more positive news on prices – at least in some parts of the country – may prompt more properties to come on to the market. If mortgage availability remains insufficient to meet the increase in buyer demand, then it is possible that prices may slip back again especially if unemployment continues to rise and mortgage rates increase.

"The pattern emerging in the regions is very interesting, with more Chartered Surveyors in London, the South-East and the South West reporting rising prices, whilst those in the North are clearly experiencing a very different marketplace."

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One thought on “Lack of supply continues to push up house prices

  1. Carla Rayman

    How refreshing to hear inventory levels are low and prices are going up! Happy to know my European friends did not suffer the real estate crash like we have in America. It has been a long four years in Florida. Thankfully, due to pricing and some new government incentives, things have been looking pretty positive since March in most markets. On the Gulf Coast of Florida (Sarasota/Bradenton areas), we saw a 10% price increase in Q2 over last year. All the foreclosures are off the market but we still are inundated with “short sales” in which the property price is worth less than the mortgage. Since builders stopped construction years ago, the inventory levels are at a minimum and due to some new demand, construction is starting again slowly.
    With residential real estate starting to move again, it will be interesting to see how our commercial markets both in America and Europe will be affected due to the lack of capital. Guess I’ll stay tuned…….

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