Rics: Too early to predict house price recovery

It is still too early to predict a reversal of the house price decreases seen over the past year, the Royal Institution of Chartered Surveyors (Rics) has suggested.

Simon Rubinsohn, chief economist at the organisation, said that a lack of new houses being made available in the marketplace is the reason for recently observed increases in property prices and claimed it would be “premature” to presume a more general rise will take place in the near future.

His comments were made in response to the latest Nationwide House Price Index figures, which revealed that house prices were up by 1.2 per cent in May.

The statistics were still down year-on-year by 11.3 per cent, but this was a significant improvement from the previous deficit of 15 per cent.

Mr Rubinsohn said: “The latest data from the Nationwide Building Society provides further evidence that house prices appear to be stabilising.”

It is thought by Bestinvest’s Peter O’Donovan that as the UK economy begins to recover, the number of people remortgaging will go up markedly.

By Chris Trimble