UK House Prices Rose for Second Month in September, Says RICS

Published October 13th, 2009 - 03:21 GMT

UK House Prices grew for a second consecutive month in September according to Royal Institution of Chartered Surveyors (RICS), an industry association for real estate agents, as the number of property brokers polled for the survey that reported price gains outnumbered those reporting declines by 22%, the largest margin since May 2007. The rebound in property values may be reflective of shallow supply rather than robust demand however as the number of for-sale properties per real estate agent remained unchanged in September from the previous month, when it had fallen 23% from the previous year. At that time, RICS chief economist Simon Robinsohn had said that it would be “foolish to believe prices are going to go up in a straight line” and cautioned that “2010 will be a more difficult year.” Demand will likely continue to face substantial headwinds in the months ahead as the unemployment rate continues to rise, trimming incomes and weighing on real estate affordability, while access to mortgage financing sees constraints from the small number of remaining lenders. Indeed, the six top lenders (Barclays, HSBC, Lloyds, Nationwide, Royal Bank of Scotland and Santander) now account for 80% of the mortgage market versus 50% just 2 years ago. A survey of economists conducted by Bloomberg forecasts the UK jobless rate will surpass 9% in the second half of next year.

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