The current lack of properties for sale is continuing to force prices upwards, according to the Royal Institution of Chartered Surveyors (RICS).
Its latest housing market survey revealed that house price inflation has hit its highest level in two and a half years.
For the fifth consecutive month, the average number of properties on chartered surveyors’ estate agents’ books fell to 56 ‘ down 15% over the last three months.
RICS’ national housing market spokesman, Ian Perry, said: ‘The continued shortage of housing coming onto the market has been the main driving force for price inflation and there are no signs of it easing. The announcement in the Chancellor’s Spending Review of extra money for housing will do little to change this in the short term.’
The difference between surveyors reporting an increase and those reporting falls in property prices rose by 4% to 65% ‘ over double the long run average of 24%.
Reported price inflation was highest in the East Midlands. Stephen Jeffrey, a chartered surveyor at Derby-based Jeffrey Jones Partnership, said: ‘A shortage of properties coming onto the market means we have seen a rise in prices. Offers are now at asking price or above and price inflation looks set to continue.’
The second highest level of price inflation was found in the West Midlands. Following a lull at the end of 2001, London and the South East also reported increases.
However, surveyors also reported concerns prices may start to fall in the next few months due, in part, to the holiday season, but also the sentiment the housing market is beginning to slow.