Property shortage prompts panic buying

Shortage of properties causing panic buyingPic: Getty

The rise and rise of the house prices has been good news for many, but the strength of the market has now prompted a spate of panic-buying.

Sales have now reached their highest level for six years, and those buyers searching for a family home are snapping up properties fearing that they may soon be priced out of the market. And there is even more urgency for families, as a shortage of two and three-bedroom homes means it's very much a seller's market.

According to the Royal Institute for Chartered Surveyors (RICS), 23 homes were sold per surveyor during the first three months of the year, the highest level since February 2008. The RICS estimates that high demand combined with low supply will keep prices rising by six per cent a year for the next five years, and competition is said to be "fierce" in the family homes market.

However, some buyers are now becoming cautious about paying over the odds for properties, with houses seen as 10 per cent too expensive simply not selling, particularly in the South East.

Simon Rubinsohn, chief economist at RICS, told the Telegraph: "House prices in general look set to remain firmly on the upward trend, although there are some tentative signs that the price momentum in the London market may begin to slow in the second half of the year.

"The critical issue for the market remains the lack of second-hand supply, with our numbers suggesting that the picture is, if anything, getting worse."

Mr Rubinsohn added: "Clearly the absence of properties to buy will ultimately be a factor in influencing the ability of people to move homes."

What do you think? Are house prices over-inflated in your area, or are you keen to snap up a property before they rise further? Leave your comments below...