RICS survey reveals Yorkshire house prices increase due to stock shortages

Throughout April, house prices in Yorkshire and the Humber saw a steady increase whilst supply of homes for sale across the region fell, according to the latest RICS (Royal Institution of Chartered Surveyors) UK Residential Market Survey.

The survey revealed 35% more surveyors in Yorkshire and Humber saw prices rise in April, which were up from 33% in March and 28% back in February, but new instructions slipped to a net balance of -39%.

Furthermore, the flow on second hand stock onto the market dropped in most regions throughout the country, including Yorkshire and the Humber.

A the same time, however, respondents’ reported an increase in prices in every area of the UK; which is due to the shift in tone in the London market where 28% more respondents saw prices in the capital rise (compared with 6% more surveyors in March who saw house prices fall).

As for the future, 29% of surveyors in Yorkshire and the Humber claim house prices will continue to rise over the coming months. Meanwhile in the lettings sector, tenant demand fell slightly last month, but 30% more surveyors in the region expect the rental market to increase again over the coming three months, with rents expected to steadily rise.

A major contributor to these trends will have been the uncertainty ahead of the 2015 general election. However, the downward trend in owner-occupation rates across the country is a visible sign that affordability constraints bite ever deeper, as does the squeeze on household budgets from higher rents.

Alex McNeil, MCRIS of Bramleys in West Yorkshire, said: “Overall demand is satisfactory, particularly for new houses where the national builders are able to provide incentives. Demand for second hand stock is more fragmented and price sensitive.”

Mark John Hunter. MRICS of Grice and Hunter in South Yorkshire, added: “We have seen a general increase in activity. We are now undertaking far more surveys/valuations for purchasers/lending institutions in relation to actual transactions – previously these have been for re-financing/ongoing facilities.”

Simon Rubinsohn, RICS chief economist, said: “It is conceivable that the decisive outcome to the election could encourage a pick-up in instructions to agents and ease some of the recent upward pressure on house prices but it is doubtful that this will be substantive enough to provide anything more than temporary relief. Alongside an increased flow of second hand stock, it is absolutely critical that new government focuses on measures to boost the flow of new build.’’

Jeremy Blackburn, RICS head of policy, added: “The affordability and availability of homes in the UK is now a national emergency and addressing this crisis must be the priority for the new government. The last time we were building 300,000 homes was in 1963 under Harold Macmillan’s Conservative government, which utilised both public and private building.

“RICS calls for a coherent and coordinated house building strategy, across all tenures. This should include measures that will kick-start a supply-side revolution, such as mapping brownfield, addressing planning restrictions and creating a housing observatory to assess the underlying economic and social drivers of housing and provide the impetus for solutions.

“Introducing demand-side measures, such as extending ‘Right to Buy’, will not see the Conservatives deliver on their promise of 1m homes by 2020.”

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