Severe shortage of property pushing up asking prices
Call it supply and demand, or market forces, but the result of any shortage is usually an increase in price and the property market is not immune from this. The shortage of property being put onto the market in England and Wales has resulted in prices that keep rising.
Figures in show that in East England, the price which is being asked for homes put up for sale, has risen by 2.1% this year as a result of demand outstripping supply, the average increase of asking prices in England and Wales is up 0.7% month on month.
Data from Home.co.uk is also showing that prices being asked for homes have increased across all regions with the exception the North West and North East during the last month, it also shows that year on year at asking prices have increased 8.1% overall.
It is the East of England though which appears to have the most acute problem with asking prices up 12.2% year on year, this put it ahead of the two areas that have usually shown the UK’s greatest price increases, Greater London and the South east, here the annual rise has been 10.3% whilst East of England showed increases of 12.2% in the same period. The report also said that the strong rising trend seen across England and Wales with continue as the interest rate, it is suggested, will hold until at least 2017.
The major factor that remains is the lack of properties for sale, and this scarcity looks set to continue for at least 2016, currently the number of properties that are coming onto the market is down by 8% when compared to a year ago. West Midland appears to be than region where lack of properties coming onto the market is most acute with 17% less this January than January 2015. East of England also is suffering from lack of property entering the market and agent’s report that it is down 14%.
What is clear is that until there is a concerted effort to build more homes the situation is not going to improve. Interest rates are set to hold as we have seen and this is sure to see a price growth continue, spreading out from London across the rest of the country. Buy to let investment continues to grab many of the homes available which will only make the situation worse.
For first time buyers in particular, this property boom is not going away while borrowing remains so cheap, it can be expected that prices will continue increasing both this year and possibly into next year as well.