RICS Reports House Price Increases

The latest RICS housing prices survey showed that the British property market significantly improved in July as a large proportion of surveyors reported rises rather than falls in house prices. The number of respondents to the survey, carried out by the Royal Institution of Chartered Surveyors, reporting a decline in property values exceeded the number of respondents reporting a rise in house prices by a mere 8% - the smallest difference since the beginning of the credit crunch. RICS survey results were supported by a separate report published by BRC (British Retail Consortium) – a body representing 80% of British retailers - which demonstrated an increase in retail sales in July 2009. In particular, it showed that retail-sales of the same stores increased by 1.8% in July 2009 compared to July 2008. A separate report from the BRC showed same-store retail sales in July rose by 1.8 percent from a year earlier. According to British Retail Consortium report, the total number of sales rose by 3.6%. RICS report highlighted that the improvement in the sector of residential property might well has been achieved due to increased mortgage approvals, which have hit a 14-month high in June 2009. Another reason for residential property market rise is the extension of the bond purchase programme, carried out by the Bank of England, to £175 billion. Mr. Jeremy Leaf, Royal Institution of Chartered Surveyors’ representative, mentioned that the property market might slip back again despite the fact that it is currently rebounding. In his opinion, scarce mortgage availability coupled with growing unemployment and mortgage rates might lead to another decline in property prices. RICS survey covered 12 regions, of which London was the one to show the biggest improvement with 29 surveyors reporting a rise rather than a fall in property values in the past 3 months. Scotland was the region to show second biggest improvement with 15 surveyors reporting rise in house prices.