Housing starts to hit 115,000 in 2013, says RICS
The housing market will pick up in 2013, with starts expected to edge up towards 115,000 in England
As the end of the 2012 nears, the Royal Institution of Chartered Surveyors (RICS) said housing starts during the last 12 months would fall short of the 100,000 mark in England, down from 111,000 in 2011.
The organisation predicted that house prices could rise two per cent in 2013 and the cost of renting would increase by around four per cent.
The number of transactions will also rise more than three per cent to 960,000 (from 930,000 in 2012), it said.
In London, the prime central market is likely to be broadly stable following the tax changes announced earlier in the year but much of the rest of the capital will continue to see above average increases.
The South East and the North West should also see modest rises. The rest of the country will either see prices dip slightly or remain flat.
But Simon Rubinsohn, RICS chief economist, warned: ‘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 come 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.’
2013 UK housing market:
- House prices to increase by two per cent
- Cost of renting to grow by four per cent
- Transactions to modestly increase to 960,000
- Repossessions to drop to below 35,000
- Housing starts to edge up towards 115,000 in England