Property Prices Increase As New Houses Built

Property Prices Increase As New Houses Built

Property Prices Increase As New Houses Built

On Tuesday, it was revealed that the Royal Institute of Chartered Surveyors (RICS), said 21% of its members had reported an increased workload during the second quarter of the year.

The poll, the most upbeat since the start of 2007, indicated that the reported recovery of the UK property market was widespread, with surveyors in almost all of the UK’s regions and industry sub-sectors becoming busier.

The best-performing regions were London and the South West, often referred to as the driving force behind the UK property market, while the worst region was Northern Ireland, the only part of the UK where RICS surveyors continue to see their workload shrink.

House prices in England and Wales rose by 0.6% in June 2013, driven by a 3.1% increase in prices paid in London, according to figures from the Land Registry. Despite the headline growth figure there were regional variations, with rises in just four of the 10 regions covered and falls of up to 2.2% in the others.

The official figures showed that prices in the capital continued to surge during the month, driven by a combination of the weak pound and continued hunger of overseas investors, and increased availability of mortgages for UK buyers.

The RICS news follows last week’s verbal attack on the Help to Buy scheme by Chief Economist at the Institute of Directors (IoD), Graeme Leach, who said “The housing market needs help to supply, not help to buy, and the extension of this scheme is very dangerous. Government guarantees will not increase the supply of homes, but they will drive up prices at a time when it seems likely that house-prices are already over-valued. When the scheme is withdrawn, any rise in prices that has taken place will be undermined, with potentially disastrous results. There is a real risk that the housing market will become dependent on the underwriting by government, making it very difficult politically to shut the scheme down. This should be of great concern. The world must have gone mad for us to now be discussing endless taxpayer guarantees for mortgages. Instead of trying to pump up prices, the government should focus on relaxing planning laws and reducing local authority charges on developers to make it easier to build more homes”.

However, plenty of new homes are being built, and the National House Building Council (NHBC) announced that a total of 67,422 new homes were registered in the first half of the year, the highest figure since 2008.

The NHBC said its registrations, which reflect builders’ housing starts, account for 80% of the UK new-build market. Taking the second quarter of 2013 alone, there was a 38% increase on a year earlier to 35,683 starts.

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