Soaring demand pushes house prices higher in the West Midlands

HOUSE prices in the West Midlands jumped last month as rocketing interest from would-be buyers dwarfed the amount of properties coming onto the market.

October’s Residential Market Survey from industry body RICS (Royal Institution of Chartered Surveyors) shows a net balance of 50% more surveyors in the region reporting a rise in house prices during the month of October (up from 40% in September).

This is the highest reading since November 2002 and demonstrates the impact that the imbalance between supply and demand is having on the market, RICS suggests.

But surveyors across the region note that while the Government’s Help to Buy initiative is boosting buyer numbers, a lack of new instructions from vendors is proving problematic.

In tandem with house price rises, 60% more surveyors in the West Midlands reported an increase in new buyer enquiries last month, compared with 52% back in September.

Meanwhile, with Help to Buy widening the net of those now in a position to purchase their own home and the loan to value rates on offer to buyers continuing to creep upwards, demand for rented accommodation in the West Midlands remained relatively low.

A net balance of 16% of respondents reported rises in interest from potential tenants during October (from 15% in September).

With the market continuing to grow, the number of homes sold in the West Midlands also saw an increase last month. In the three months to October, chartered surveyors sold an average of 21 homes, the highest amount since April.

Simon Rubinsohn, RICS chief economist, said: “It’s no secret the housing market in the West Midlands is gathering some momentum and that buyer numbers are on the rise. A greater willingness by lenders to increase loan to values on mortgage products allied to the Help to Buy scheme has meant that more and more first time buyers are in a position to enter the market.”