Property prices in the UK continued to increase in October, while the number of homes put up for sale fell for the ninth month in a row.
The Royal Institution of Chartered Surveyors (RICS) revealed that its monthly house price balance climbed up to +49 in October from +44 in September – indicating that house price growth picked up steam last month.
According to mortgage lender Halifax, house prices in the three months to October rose 9.7 percent.
RICS attributed the increase in property prices to an imbalance between demand from buyers and the number of homes for sale.
“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,” Simon Rubinsohn, RICS chief economist, said.
RICS expects property prices to increase by just under 4.5% a year over the next five years, which would add £42,000 to the average cost of a home in England and Wales.
“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 on boosting the delivery of new homes absolutely critical,” said Rubinsohn.