House price growth set for slowdown, say surveyors

UK house price inflation is set for a slowdown over the coming months, a survey by the Royal Institution of Chartered Surveyors (Rics) suggests.

It said the forthcoming referendum on European Union membership and elections in Scotland, Wales and Northern Ireland would cool the housing market.

Rics said the Stamp Duty increases for landlords that came in on 1 April were another factor.

The Halifax has also said that the EU vote is likely to slow the market.

"Elections inevitably bring with them periods of uncertainty in the market, and our figures would suggest that next May's devolved elections are no exception," said Simon Rubinsohn, Rics chief economist.

"Likewise, the EU referendum, is likely to be an influencer in terms of the damper outlook for London in particular."

The survey showed that most surveyors in London expect prices to fall over the next three months.

The number of surveyors expecting a price fall outweighed those expecting a rise by 38%.

However in other parts of the country, surveyors were much more optimistic.

In north west England and in Northern Ireland most survey respondents expect prices to rise significantly over the spring and early summer.

And in the longer term, Rics expects house prices to rise by more than 4% a year in England and Wales - whatever the results of the EU referendum and the elections.

"The imbalance between demand and supply will still exert a strong influence on the market, with house prices expected to rise by close to 25 per cent over the next five years," said Mr Rubinsohn.

Recent estimates of house price inflation vary from 10.1% in the year to March by the Halifax - to 5.7% by the Nationwide.