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Slump in new instructions is sustaining house prices

Christina Hoghton
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Christina Hoghton

A lack of stock on the market means increased competition from buyers, which is pushing up prices

A shortage of homes available on the market is creating competition amongst buyers, and pushing up house prices, according to the Royal Institution of Chartered Surveyors.

The organisation added that new instructions softened again over the last month, along with sales. But it noted that demand from buyers was stabilising.

Surveyor Will Ravenhill, of Readings Property Group in Leicester, said: “Most properties of decent quality or that are a bit interesting are creating massive amounts of demand. Stock levels are at their lowest ever though.”

This was echoed by surveyor Dan Elliott of Wilkins Vardy Residential in Chesterfield, who added: “A lack of new listings is holding back demand. Buyers are still registering but new instructions have slowed down.”

Sarah Coles, personal finance analyst at Hargreaves Lansdown, said of the figures: “Sellers can’t see anything on the market to buy, so don’t want to sell, creating a vicious circle that is causing a property drought. This is the sixth successive month of fewer properties coming to the market, so house-hunters have nowhere to go, and sales are falling. One agent said that if we continue on this path, we won’t have a sales market at all by the spring.

“Popular properties are still creating bidding wars, which is pushing prices up, but not at the rate of the peak this spring, and the agents say some of the panic buying has come out of the market. It means buyers have the worst of all worlds, because they can’t find a property they want to live in, and if they settle for second-best, they’ll have to pay through the nose for it.”