House Price Update to 16 June 2010

UK House Prices Situation: Rising slowly in most areas

UK House Prices Forecast: Budget and public sector job losses pose threat

RICS Figures Show House Prices Creeping Up

The latest housing market survey figures from RICS show that on a seasonally-adjusted basis, house prices rose faster in May than in April. May saw 22% more surveyors report a rise in house prices than a fall – up from 19% in April.

Buyer interest also crept up with the new enquiries net balance rising from +9 to +10, reflecting that 10% more surveyors experienced an increase in new enquiries than a fall in April.

HIPs Scrapping Results in Surge of Seller Instructions

RICS also found that the scrapping of the much-criticised HIP scheme resulted in an immediate increase in new seller instructions. 21% more surveyors reported an increase in new seller instructions than a fall – up from just 11% in April, before the general election.

Now that people can put their homes on the market without having to pay and wait for a full HIP to be prepared, they are much more willing to test the waters and see if there is any buyer interest in their home.

Surveyors questions reported that they expect the scrapping of the HIPs scheme to lead to a rise in the supply of new properties of around 15%.

Unemployment Concerns & Price Falls in Regions

Concerns over a possible rise in unemployment following the budget are mounting, especially as it seems likely that there will be large job cuts in the public sector. This, combined with the difficulty many borrowers still have in securing the best mortgage deals, is restricting housing market activity in many areas.

The latest RICS figures show that although prices rose in most areas of England and Wales in May, prices in Wales, Yorkshire & Humberside and the West Midlands fell during May.

Read about UK House Price indexes / key statistics that track the ups and downs of house prices

Read our take on the Credit Crisis the effect on UK House Prices and Mortgages. A Special Report

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