RICS report finds fall in buyer demand due to interest rate rise
UK house prices slowed to their lowest rate of growth in one-and-a-half years in June as interest rate hikes deterred potential buyers, according to a report by the RICS.
The latest RICS UK housing market survey has revealed that the number of surveyors reporting higher house prices in England and Wales outnumbered those showing declines by 10.6%, down from 22.5% in May, and the lowest reading since January 2006.
Ian Perry, RICS spokesman, said: "House prices have finally started to cool significantly for the first time since the recent mini-boom in the housing market got underway in 2006."
Although house prices rose for the 20th consecutive month, the rate of growth more than halved from 21.6% with new buyer enquiries falling across all regions except Wales, the West Midlands and Scotland.
The number of surveyors to report a fall in new buyer enquiries for June was 15% compared with 2% in May.
The RICS blamed the continued increase in interest rates which rose to a six-year high this month, for the fall in demand from buyers.
Perry added: "Interest rate hikes have begun to affect the psychology of the market with potential new buyers starting to think twice before buying a home."