House Price Rises Slowest in 17 months

RICS reports UK house prices rose at their slowest annual pace since May 2013 at the end of 2014, as tighter lending rules and a looming national election weighed on buyer demand.

The housing market has been slowing since mid-2014, when regulators introduced the Mortgage Market Review making affordability tests for banks lending criteria more stringent.

Mortgage lender Halifax said last week that house prices in the fourth quarter of 2014 were up 7.8 percent on the year, down from a peak of 10.2 percent in July.

RICS said that as well as tighter lending rules, the national election due on May 7 was also causing both buyers and sellers to pause for thought.

RICS members continued to expect that a cut in property transaction tax for homes costing under 937,000 pounds announced by the Chancellor in December would boost prices and sales by 2%-5% percent in 2015.