The latest Royal Institute of Charted Surveyors (RICS) UK Residential Market Survey revealed that the number of homes coming to market has fallen, which is causing price rises across the UK. The exception to this rule however, is London, which has seen house prices fall. For the capital, this was the sixth consecutive month of declines in house prices.
- Number of houses coming to market is falling, which is pushing prices up in regions across the UK
- London is the exception and has seen a fall in prices
- RICS still predicts that house prices in the capital will rise by as much as 30% over the next 5 years
- Surveyors are now predicting nationwide house price growth of 2.4% over the next 12 months, up from 1.8% in January
London, the only region to witness falling prices
Overall, London was the only region where the surveyors reported that prices were falling. The monthly snapshot released by RICS revealed that Scotland and Ireland were continuing to outperform the rest of the UK, while the South West and South East of the UK also fared strongly.
The RICS survey results, that revealed London’s falling prices, came at the same time as our Rental Index revealed that London’s rental price growth was slowing in 2015. To coincide with this, and to understand the London letting market more, we also conducted a study on London Letting Agents - which showed that demand was still high in the capital, with most respondents placing demand at 8 on a 1-10 scale, with 10 being the highest level of demand.
Partly due to this high level of demand, RICS has suggested that the fall in prices in London may only be temporary, with its predictions showing an expectation that London’s house prices will increase by as much as 30% over the next 5 years.
Nationwide expectations rise
Nationwide, the survey revealed that price expectations over the next three months have increased from a net balance of 3%, expecting rises to 10%, with surveyors now predicting that there will be house growth of 2.4% in the UK over the next 12 months. This is a 0.6% rise of January’s 1.8% estimate.
The latest RICS release gives us a keen insight into the property market at present, particularly in London - which isn’t following the trend set by the rest of the UK. With the RICS survey showing that this may be a temporary blip in London’s housing market, it will be interesting to reassess the landscape in the next 6-12 months and see how it evolves.