On 22 December 2009, the Royal Institution of Chartered Surveyors’ (RICS) UK Housing Market Forecast indicated that house prices will finish the coming year one or two percent higher than at the end of 2009. Transactions are likely to rise to a monthly average of 70,000 from 55,000 to 60,000 currently.
RICS adds that supply should continue to increase in the early part of 2010 but will struggle to keep pace with demand providing a platform for further house price rises. Significantly, the inventory of stocks on surveyor's books still remains close to historical lows. However, the narrowing in the gap between supply and demand will gradually begin to exert a greater influence on the market.
The on-going caution of lenders, the uncertain economic climate and a flat labour market are all also likely to present challenges resulting in prices finishing the year only one or two percent higher than they started it.
Which way do you think house prices will go? Could changing interest rates also be a factor in determining the direction of the market?
