The UK housing market appears to be gaining momentum once again. Economists are predicting that average house prices are likely to rise by more than 9pc between now and the General Election in 2015, fuelled by schemes such as Funding for Lending and Help to Buy. This would take the average house price up by almost £15,000 to £179,000.
An industry survey conducted by the Royal Institution of Chartered Surveyors (RICS) reveals that prices are rising at their fastest rate since November 2006. RICS has recently been in the news calling for the Bank of England to restrict mortgage lending if house price growth tops 5pc a year, as they believe this would manage the volatility of the market, against concerns about another housing bubble emerging in the future.
Recent news would imply that rising property values are spreading beyond the well-documented ‘property hotspots’, namely London and the South East. RICS figures suggest that homebuyer activity is increasing fastest in parts of the UK where prices have been the most depressed. The largest rise in activity came in the West Midlands and north-east England.
Analysts at IHS Global Insight estimate that, across the board, prices will rise by at least 3% over the rest of 2013 and increase by a further 7% in 2014.