- On August 10, 2017
House price growth is faltering in London and the South East, new figures from the Royal Institution of Chartered Surveyors (RICS) show.
Just 1% of RICS members reported an increase in prices in July, compared to 7% in June, suggested that house prices are flatlining.
The report also reveals what it says are “diverging trends” across the UK, with prices firmly on an upward trajectory in some areas.
Northern Island, the West Midlands and the South West all saw steady increases over the past two months.
The negative net balance in London and the rate of decline matches the previous three months, however the reading in the South East was the weakest since 2011.
Simon Rubinsohn, RICS chief economist, said: “Sales activity in the housing market has been slipping in the recent months and the most worrying aspect of the latest survey is the suggestion that this could continue for some time to come.
“One reason for this is the recent series of tax changes, but this is only part of the story.
Lack of new builds
“Lack of new build in the wake of the financial crisis is a more fundamental factor weighing on the market.
“And there are some very real consequences for the economy from all of this including the impact on the ability of people to be mobile when looking for work.”
Despite the flatter trend, Mr Rubinsohn said, there was no real indication of houses become more affordable in the near future.
“Hence the need for the government to press ahead with the Build to Rent initiative, as well as continuing to focus on other tenures alongside home ownership to try address this critical issue,” he added.
In terms of whether homes are still selling for the asking price, 68% RICS members who responded said that top end properties valued at more than £1million were coming in below asking prices.
Although RICS said this was not uncommon, 33% of respondents said they agreed price was up to 5% below the asking price and 26% reported between 5% and 10% under.
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