Interest rate hike finally stops house price rise

House prices have frozen for the first time in a year, reveals the latest report from the Royal Institution of Chartered Surveyors.

A survey of chartered estate agents for the last three months suggests house prices have slowed across the country, even though 20% of surveyors said prices rose to July, says RICS.

That said, house prices are now static in the Midlands and East Anglia and some areas of southern England have seen values fall, compared with increases in the North West, Yorkshire and Humberside and Wales. The only locations to show robust price rises were the North East and Scotland.

Scotland and the North East are the only regions still thought to have seen strong house price rises, even though thinking now suggests house price inflation these regions are merely progressing slightly slower than most of the UK.

It is as a result of the “back-to-back interest rate rises” few people are now looking to buy a property, says RICS, even when taking into account the quieter buying pattern of summer house purchases.

But the number of houses being put up for sale on surveyors’ books rose in July compared with June, says RICS housing spokesman, Ian Perry:

”This is a traditionally quiet time of year but still buyers and sellers are showing a noticeable air of caution. The latest indication from the Bank of England is that interest rates are unlikely to increase substantially from now until the end of the year.

“Unlike last year, the supply of new property coming to the market has remained low and kept market conditions fairly tight, which is a major factor underpinning prices,” adds Perry.