Property to be unaffordable,Surveyors predict


By Caroline Namanda

Property will become “even more unaffordable” over the next five years creating a critical need for a house building programme, surveyors say. Property prices and the cost of renting a home will continue to rise owing to a shortage of supply, a survey by the Royal Institution of Chartered Surveyors (Rics) found. It said prices had risen for the last three months in all parts of the UK.

The number of homes put on the market has fallen every month since February. “The legacy of the drop in new build following the onset of the global financial crisis is now really hitting home, with both the sales and letting markets continuing to show demand outstripping supply on a month by month basis,” said Simon Rubinsohn, chief economist at Rics.”If the five-year projections from members regarding the outlook for both prices and rents is anything to go by, property is set to become even more unaffordable going forward making the government’s focus of boosting the delivery of new homes absolutely critical.

The survey found that demand continued to outstrip supply in many parts of the UK. Prices were rising as a result, but the fastest increase was not in London – as has been the case in recent years – but in the East of England. East Anglia has consistently seen the fastest pace of increase in each of the last three months, Rics said.  The pace of rises in interest rates would dictate the pace, distribution and sustainability of house price growth, it said.