Deceleration in house price inflation likely

If you are considering investing in property you may be interested in the June RICS UK Residential Market Survey which suggests that further deceleration in house price inflation is looking more likely.

Deceleration in house price inflation likely

The survey reveals that the headline price balance eased from 17% to 7% in June. The price balance is now more subdued in the South East, whilst in East Anglia and the North there has been little change from recent readings.

London continues to return the most negative net balance with no sign of easing in the pace of decline.

Jeremy Duncombe, director of Legal & General Mortgage Club, said: “Overall sentiment within the RICS survey has remained quite pessimistic over the past few months, and this outlook of a dip in house prices and market activity is not surprising.

“Yet when compared to the wider economic and political landscape, the housing market has continued to amaze many. It has remained consistently robust, despite everything we have seen over the last 12 to 18 months.”

Average stock levels have seen a marginal slip to record low levels; however most parts of the UK show a fairly similar pattern to headline numbers. This lack of housing stock, however, does support house prices.

Peter Williams, executive director of IMLA, added: “For another consecutive month, RICS’ survey points to a housing market gradually losing momentum, with members reporting dwindling numbers of enquiries, instructions and sales.

“However, whilst activity in the housing market may be beginning to slow, long-term price growth will be supported by supply-side shortages across the country and high customer demand.”

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