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Surveyors warn of supply pressures driving up house prices

Written by: Samantha Partington
House prices in March were driven up by a lack of properties coming onto the market for the second month in a row, a survey from the Royal Institute of Chartered Surveyors (RICS) revealed.

The imbalance of the supply and demand of homes has led to a net balance of 21 per cent of surveyors reporting a rise in house prices compared to 15 per cent in February. The net balance shows those who had recorded a price increase exceeded those who had recorded a drop in prices.

Looking forward to the next three months, a net balance of 15 per cent of surveyors surveyed said they expected prices to rise compared to 10 per cent in February.

In London, the number of enquiries and agreed sales fell for the 11th consecutive month caused by a lack of prospective buyers. Nationally, Northern Ireland outperformed the rest of the UK with house price growth in March and expectations for increases in property prices over the next three months. Surveyor sentiment in Northern Ireland reflected the figures released this week from the Office of National Statistics which showed house prices in Northern Ireland went up 14.2 per cent in the year to February, the biggest rise since November 2007.

In comparison house prices in England increased by 7.4 per cent over the same period. March was the first month this year which saw instructions to sell homes increase in Northern Ireland but strong demand from buyers continued to push up prices.

But RICS Northern Ireland spokesman Samuel Dickey said he expected more properties to come onto the market in the months ahead which should ease the pressure on prices and support growth in transactions. Dickey said the sharp rises in property prices indicated the market was still in recovery mode with values still a way off their peak.

Head of lending products at Ulster Bank Derek Wilson said mortgage demand had been rising steadily since the start of the year. To support borrower appetite Ulster has made a record number of mortgage products available to the market and it launched a seven-year fixed rate range.

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