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Shortage of homes pushes prices to record level


A shortage of homes on the UK market has caused house prices to reach a record average of £200,280, according a mortgage lender Halifax.

The number of homes on the market has fallen to a 37 year low, pushing house prices up 1.7% to further unattainable levels. The Royal Institute of Chartered Surveyors (Rics) has confirmed that the number of homes on sale for each member has fallen from an average of 61 in June last year to 49.5 this year. This is compared to a peak of 148 in 1996.

The low stock of houses is a self-perpetuating problem, as people are put off selling because there is little choice of homes to move to. Other reasons for the lack of properties include the high cost of stamp duty in expensive areas, and other fees included in moving house has made renovations and extensions more preferable to moving.

Demand for homes has risen in all areas of the country expect the south-east, which is keeping house prices rising.

Rics chief economist, Simon Rubinsohn, said: “There had been some hope that the removal of political uncertainty following the general election would encourage more properties onto the market but the initial indications are that this is not proving to be the case.

“Additionally, the recent flat pattern of appraisals by respondents to the survey suggests this is not about to change anytime soon. As a result, it is hardly surprising that prices across much of the country are continuing to be squeezed higher with property set to become ever more unaffordable.”

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