BRITAIN’S property market appeared undaunted by rising interest rates yesterday after new figures showed prices continued to accelerate last month.
Prices rose in August at their fastest pace since May 2004, according to the survey from the Royal Institution of Chartered Surveyors (RICS). A balance of 35 per cent more surveyors reported rises in prices than falls, up from of 30 per cent in June.
The RICS said that buyer inquiries were rising at their fastest pace since September 2003. Estate agents said that price rises were being driven by would-be buyers returning to the market and limited availability of new property.
The survey, taken after the Bank of England raised rates to 4.75 per cent, suggested that it may take time before tighter monetary policy halts the “mini-boom” in house prices. Expectations of rises over the next three months have eased slightly, the RICS said, but confidence remains high.
Ian Perry, of RICS, said: “Would-be buyers have been encouraged by a strong economic performance, but additional rises in interest rates before the end of the year could deter buyers. With accessibility 300 per cent worse than ten years ago, first-time buyers will continue to struggle.”
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The Council of Mortgage Lenders (CML) reported that first-time buyers are paying their highest ever income multiples for homes, which stand at an average of 3.24 times average income, up from 3.21 times in June.