- Simon Rubinsohn, chief economist at RICS
House prices in the UK increased at the slowest annual rate since May 2013 at the end of 2014, as buyer demand was subdued by stricter lending rules as well as a looming national election due on May 7. According to the Royal Institution of Chartered Surveyors, monthly house price balance dropped to +11 in December compared with +13 in the preceding month. The gauge measures surveyors' assessment of whether house prices have risen or declined on a yearly basis over the previous three months. While the balance of surveyors reporting growth dropped in most parts of the country, it was most pronounced in London, where for a fourth straight quarter more surveyors reported price increases than declines. RICS said its members have suggested that the recent reforms to stamp duty, which lowered tax bills for most homebuyers, would lead to an increase in activity and prices over the coming year. Sales and prices are seen to climb by 2%-5% in 2015 as a whole. Last week one of the biggest mortgage lenders in Britain Halifax said that house prices in the final quarter of the previous years surged 7.8% on year, down from 10.2% in July.
Britain's housing market has been slowing since mid-2014, when authorities forced banks to make a more meticulous checks on whether borrowers would still be able to afford mortgage repayments if interest rates increase sharply.
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