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House prices continue up – albeit at slower pace

Fresh demand for property is still outstripping new supply but the gap has narrowed. Some 20% more surveyors stated that inquiries from potential purchasers are rising rather than falling but inquiries rose at the slowest pace since January 2009. Other demand indicators are also losing some momentum, although they remain in positive territory. The newly agreed sales balance slipped to 22 from 24 while the sales expectations net balance dropped to six from 20.

Transaction levels were little changed in December. The number of sales per surveying firm is still hovering around 19 for the fourth consecutive month while the closely watched sales to stock ratio – a measure of market slack and a lead indicator of future prices – fell back slightly.

RICS spokesperson, Jeremy Leaf said: "New inquiries are continuing to outpace new instructions which is helping to push house prices higher. The recent loss of momentum in prices and the moderation in new buyer interest can be in part attributed to the housing market pulling down its shutters for Christmas. It is likely that the new year will see more interest and activity in the market as those who held back start to market their property with renewed optimism."

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