UK surveyors see slower house price rises after tax hike

[LONDON] British property prices kept up a rapid pace of growth in February, but increases are likely to slow in the months to come as higher taxes on landlords take effect, property valuers said on Thursday.

The Royal Institution of Chartered Surveyors said its monthly house price balance rose to +50 last month from a downwardly revised +48 in January, sticking within the same narrow range where it has been for the past five months.

RICS's chief economist Simon Rubinsohn said prices had been pushed up in recent months as property investors sought to buy houses before a 3 per cent surcharge on their purchases takes effect next month.

"It is inevitable that over the coming months, April's stamp duty changes will take a little of the heat out of the investor market," he said.

RICS's index for price increases over the next three months sank to +21 in February from +33 in January and +44 in December.

Sales were rising at the joint-fastest rate in almost two years, apart from in London, where RICS said there was anecdotal evidence that concerns about Britain's June 23 European Union referendum and global economic uncertainty had sapped demand.

In the longer term, government efforts to boost construction were unlikely to be enough to counteract a lack of housebuilding since the 2008 financial crisis, and surveyors expected prices to rise by a quarter over the next five years, Mr Rubinsohn said.

REUTERS