20 things

20 things you should know about

20 January 2007

1 The Royal Institution of Chartered Surveyors (RICS) revealed that house prices rose for the fourteenth consecutive month.

2However, the study indicated that the pace of increase had slowed, partly as a result of the November rate rise.

3The RICS report revealed that 37 per cent of chartered surveyors reported a rise than a fall in house prices.

4This figure was down from the 46.9 per cent reported in November.

5The December review by RICS revealed that completed property sales rose to 28.5 per cent surveyor from 28.4 per cent in September – the highest since August 2004.

6The ratio of completed sales compared to the stock of available property also rose to 42.8 per cent from 42.5 per cent. This was the highest ratio in two years and a strong indicator of a still buoyant market.

7The RICS study also showed that new buyer enquiries stabilised in December reinforcing the strength of the underlying economy in light of the two quarter point interest rate hikes that have taken place since August.

8Regionally new buyer enquiries grew in London, the North and the North West.

9However, drops were recorded in the East Midlands, South West and East Anglia.

10Buyer enquiries also declined in the South East, Yorkshire and Humberside.

11The amount of available property on the market dropped 11.3 per cent from the December 2005 findings. As a result the ratio of property sales to the available stock of property reached its highest levels for two years.

12RICS research into the South East property market revealed that house prices continued to increase firmly at well above the survey’s long run average rate, although the pace slowed in December.

13Price rises were driven by declining new instructions to sell property, which fell for the twelfth consecutive month, in spite of a fall in new buyer enquiries. Surveyor confidence in the price outlook remains at elevated levels, broadly unchanged from the previous month, while confidence in the sales outlook edged up slightly, rising above the survey’s long run average.

14In London, RICS indicated that rapid price rises were being driven by a combination of falling new instructions to sell property and firm growth in demand as new buyer enquiries werre rising at well above the survey’s long run average rate.

15In Wales surveyor confidence in the price outlook fell back to below the survey’s long run average although it remained positive, while confidence in the sales outlook rebounded firmly, rising above the survey’s long run average.

16The RICS study into the Scottish market showed that the market was regaining buoyancy, in line with confidence in the market.

17Commenting on the findings, Ian Perry, spokesman at RICS, said: “Interest rate rises have started to cool the housing market and last week’s rise will have a further impact in the coming months, but the market remains strong. However, the rate rise will do nothing to aid home owners struggling with affordability conditions with more repossessions looming on the horizon.

18 He added: “As we move further into the New Year, consumers will begin to tighten their belts as finances come under pressure but rising wages and employment will continue to boost the economy and RICS expects interest rates to finish at 5.5 percent by year end.”

19RICS housing market survey is the longest running monthly survey of house prices in the UK, collecting data since January 1978.

20The survey is cited by the Bank of England's monetary policy committee at its monthly interest rate setting meetings.