Rics: property starts stagnating

Property experts have claimed that the UK is in the grips of a house-building slowdown, prompting concerns that demand is plummeting as people put off home purchases and opt to rent instead.

A slowing housing market has been identified by the Royal Institution of Chartered Surveyors (Rics), who claimed that the profit outlook of the UK construction industry was suffering the fallout.

Only 16 per cent more chartered surveyors were claimed to have reported a rise than a fall in the fourth quarter of 2007, marking a lower level of growth than the previous quarter, with London property starts stagnating despite a strong demand for new housing in the capital.

Rics senior economist David Stubbs said: "A slowing housing and commercial property market, following the credit crunch and the Northern Rock turmoil have started to hit the construction sector.

"Current financial instability is rocking market sentiment and may see the industry enter a period of uncertainty. Doubts are likely to intensify over the ability of the government to meet its ambitious house building targets."

Rics explained that new enquiries for housing were growing at their slowest rate since 2006.

News posted on 25th January, 2008