More surveyors predict strong 2014

Home For Sale Real Estate Sign in Front of New House.

%VIRTUAL-SkimlinksPromo%Surveyors' expectations that house prices are set to increase into the new year surged to their highest levels in more than 14 years in November.

The Royal Institution of Chartered Surveyors (Rics) said that a balance of 59% more surveyors predict rises will increase rather than edge down over the next three months as the number of homes for would-be buyers to choose from continued to fall "well short" of demand.
Meanwhile, the proportion of surveyors predicting sales will pick up heading into 2014 reached a record level, with a net balance of 76% more surveyors expecting sales to increase, marking the highest reading in records going back to 1998.

Rics warned that without a "meaningful increase" in the supply of homes, both house prices and rents will become more unaffordable.
It said the reading for the number of surveyors predicting price rises rather than falls is the highest since September 1999 and demonstrates the impact that the recovery is having on an "anaemic supply" of properties for sale in the housing market.

In what Rics said is a "sharp" pick-up, a balance of 58% more surveyors also reported already seeing house price growth last month. For the second month in a row, each region of the UK saw prices rise.

House sales have also lifted strongly compared with a year ago. An average of just over 20 homes per surveyor were sold in the three months to November, compared with around 15 during the same period last year.

The housing market has been showing strong signs of recovery throughout 2013 following a string of Government schemes such as Help to Buy and Funding for Lending which have widened mortgage availability and fuelled demand from buyers.

A new phase of the Government's flagship Help to Buy scheme was launched in October to give more people with low deposits a helping hand on to or up the housing ladder. The scheme offers state-backed loans to people with deposits as low as 5% and lenders representing around two-thirds of the mortgage market have confirmed they will take part.

But experts have said that stronger efforts must also be made to increase the number of homes on the market, with the mismatch between supply and demand putting an upward pressure on prices.

Last week, Halifax reported that house prices rose by 7.7% in November, marking the highest increase seen in six years.

In his Autumn Statement last week, Chancellor George Osborne announced £1 billion of loans to unblock large housing developments, including in Manchester and Leeds, and raising a borrowing limit for councils to fund new homes. But housing charity Shelter called for "bolder ideas" for more affordable homes to be built.

Simon Rubinsohn, Rics chief economist, said: " It's no secret that the housing market is on the way up and prices are surging ahead in many parts of the country."

He continued: "As the Chancellor pointed out last week, housebuilding is on the up, but it is rising nowhere near quickly enough to make up the shortfall that has built up in recent years.

"If there is not a meaningful increase in new homes, the likelihood is that prices, and for that matter rents, will continue to push upwards, making the cost of shelter ever more unaffordable."

The Funding for Lending scheme which has been credited with boosting mortgage availability generally is being re-directed away from households to help small businesses.

The number of mortgages on the market has increased by around 40% since Funding for Lending was launched last year.

Mr Osborne also announced last week that non-UK residents will have to pay capital gains tax (CGT) on property sales from April 2015.

This is expected to take some of the heat out of the London housing market as s trong house price growth in the English capital has been put down in part to overseas investors looking for a safe haven to place their cash.

The people who affect house prices
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More surveyors predict strong 2014

They have the power to push a price higher, depending on how many other people are in the running for a home and how liberal they want to be with the truth to the buyers. In some cases, they can also do more harm than good by initially overvaluing a property. The worst case scenario is the home eventually sells for less than it would have done had it been priced realistically in the first place.

Sometimes a quick-moving solicitor can be the difference between getting the home at the price you want and getting into a bidding war or missing out entirely. If the buyer needs a quick sale, they're more likely to do a deal with someone who has a flexible solicitor who can push through the sale so it suits them.

Research by Halifax concluded that anti-social neighbours could take £31,000 off the price of an average home. If you’re selling, you should declare any problems you’ve had on a Seller’s Property Information Form, otherwise you could face a claim later on.

While an increase in Council Tax might not be too much of a deterrent to a potential buyer, plans to grant permission for new homes, a mobile phone mast or wind turbines could knock an asking price down. If you're a buyer, the local council should have details of any future planning applications and you can search them for a small fee.

A lot of traffic in an area obviously has an effect on air quality. Since 1997 each local authority in the UK has carried out studies of the air quality in its area. If an area falls below a national benchmark for air quality, it has to be declared an Air Quality Management Area (AQMA). Some residents of the Llandaff area of Cardiff expressed concern that it had become an AQMA due to an increase in traffic in the area. Whether this becomes a widespread issue remains to be seen.

Mortgage availability is a key driver of property prices. If no-one can take out a mortgage, then prices will stall and eventually fall. We've seen this happen in parts of the UK in recent years, as lenders tightened up their criteria following the credit crunch. Conversely, good mortgage availability will mean more people are competing for properties - to a seller's advantage if their home is desirable.

An outstanding local school can add around 8% to the value of a home, according to the Royal Institution of Chartered Surveyors. On the flipside, a not so good Ofsted report can take off a similar amount. If you’re concerned about a school’s performance, one way to get involved is to become a governor.

Initiatives such as the Help To Buy scheme have been credited with pushing house prices up. A buoyant economy with strong employment gives people the confidence to buy and leads to an upward shift in house prices, while rises in unemployment have the reverse effect. Planning restrictions, at both a national and local government level, affect the number of homes in a particular area.


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