A surge in the number of homes being put up for sale has raised fears of a new property market crash
BY THE TELEGRAPH | APR 14, 2010
Estate agents have said house sellers are returning to the market in a way not seen since May 2007, just before the property market crashed.
According to the influential monthly survey conducted by the Royal Institution of Chartered Surveyors , more and more home owners are putting their houses up for sale, raising fears that the recovery in the property market could come to an end.
The surprisingly strong performance in house prices last year was driven by a severe shortage of supply. With nervous home owners deciding not to put their houses on the market, buyers ended up chasing a small pool of properties and bidding up prices.
However, the RICS survey suggested that 21 per cent more estate agents were seeing a growth in the number of house sellers than a fall in numbers. This is the highest figure since May 2007, just before the 13-year-long house price bubble burst.
There has not been a corresponding pick up in buyers, however, and the economics of supply and demand has already fed through to house prices, which for the third consecutive month have slowed down, the survey indicated.
The average number of unsold houses on surveyors books increased by 6 per cent on the month (the highest monthly increase since February 2008) to 67 per surveyor. This is still far lower than the 90 it hit during the early stages of the house price collapse when the market froze and buyers disappeared from the market.
However, it will be a worrying indicator for those keen that last year's revival translates into a full blown recovery. One RICS member, Charles Abbot of Myddelton & Major, in Salisbury, Wiltshire, said he had seen, "a dramatic increase in the supply side with fewer inquires, possibly due to the election."
Another, William Leschallas of Jackson-Stops & Staff, in Burford, Oxfordshire, was one of many members who said the economic outlook was causing uncertainty. "The market has a cautious feel to it and no one should be complacent. There is still uncertainty out there with a lack of confidence in the economy and unemployment."
