According to the Royal Institution of Chartered Surveyors, UK house prices are set to rise 2% in 2013.
The rise is expected to come from slight improvements in the economy. This improvement will then have a small impact on the housing market. RICS did however urge caution and said that challenging conditions still lay ahead. Housing starts in England are expected to edge up to around 110,000 to 115,000 in 2013.
Simon Rubinsohn, RICS Chief Economist said: "The average house price in the UK looks set to rise by a further two percent next year, despite the uncertain outlook for the economy. More positively, the amount of sales going through should also see an increase across the country, climbing to its best level since 2007, as the Funding for Lending scheme helps boost the availability of mortgage finance."
"But these tentative signs of recovery in the sales market should not blind us to the very real problems that still exist. Even with the Funding for Lending scheme and some other government policies beginning to be felt in the mortgage market, many first-time buyers will continue to find it difficult to secure a sufficiently large loan to take an initial step on the housing market. Meanwhile, the alternative of renting is becoming more and more costly with a further increase in rents likely in 2013. Critically, the government needs to ensure that the conditions are in place that will enable the stock of new housing, whether for purchase or rent, to rise more rapidly."
The survey also predicted that transactions would rise by 3% to 960,000 against the 930,000 achieved this year. Still a long way short of the 1.67 million transactions seen in 2006.
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Source: RICS
