London property sale levels to rise to pre-recession levels

The number of house sales is to climb to its highest level since 2007 next year, the Royal Institution of Chartered Surveyors (RICS) said today.

The boost is expected thanks to planned improvements in the economy, with national house prices rising by 2% in 2013. Rents meanwhile will rise by at least 4%, RICS predicted.

The pickup will be the most apparent in London, the South East, Wales and the North West.

London’s prime central market is likely to remain “broadly stable” in 2013, despite a flutter of taxation changes targeting this property band, the surveyor said.

While multi-billion pound government schemes enacted to boost lending over the last few years are finally expected to kick in, RICS warns that first-time buyers will continue to struggle.

Around 60% of those living in private housing, are thought to be would-be buyers who are trapped in renting because they cannot raise deposits or get loans, the surveyors said.

“The amount of sales going through should see an increase across the country, climbing to its best level since 2007, as the funding for lending scheme helps signs of recovery in the sales market should not blind us to the very real problems that still exist,” said Simon Rubinsohn, RICS’ chief economist.

“Even with the funding for lending scheme and some 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.”