House price rises at highest levels since 1988, according to surveyors
Tuesday 28 September 1999
The number of surveyors reporting rising prices compared with those seeing a fall has is at its highest level since September 1988 - the height of the 1980s boom, the Royal Institution of Chartered Surveyors said.
A balance of 68 per cent said prices rose in the three months to August, the highest since the 72 per cent in September 1988. That was the last month couples were able to claim double mortgage tax relief; many believe its abolition triggered the property recession. The RICS index fell to 66 per cent in October 1988 and was negative by 1990.
Yesterday's figures showed that 96 per cent of East Anglian surveyors recorded a price rise, 91 per cent in the South-east, 81 per cent in London and 80 per cent in the South-west. "Anything that's over 80 per cent is a boom," said a spokesman.
However, in the West Midlands only 39 per cent reported rises. This compares with 50 per cent in the North-west and 52 per cent in Scotland. Surveys from the main lenders, Halifax and Nationwide, are expected to point to a widening of the North-South divide later this week.
Ian Perry, RICS housing spokesman, said: "The housing market continues to be very different across the country but the shortage of good-quality houses is affecting the market everywhere." He said that in the West Midlands, London and the North-west, the number of surveyors reporting price rises had dropped. RICS said there was little evidence of a return to an 1980s- style boom. It said surveyors expected house prices to rise over the coming quarter but that the rate of growth would slow suggesting that "runaway boom is not around the corner".
The Bank of England cited the housing market - especially the danger of people using paper gains on their home to fund a spending spree - as a reason to raise interest rates earlier this month.
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