LONDON Aug 14 Momentum behind London's property
boom appears to be fading, according to a survey on Thursday
that added to signs that rapid house price growth in Britain is
starting to moderate.
The Royal Institution of Chartered Surveyors' monthly house
price balance eased to 49 in July, its weakest reading since
February, lightly below forecasts in a Reuters poll of
economists. June was revised downwards slightly to 52.
Weakness centred on London, the survey showed.
Sales and new buyer enquiries in the capital fell more
sharply than elsewhere in the country, with a net balance of
just 10 percent of London respondents reporting rising prices -
down from 30 percent in June.
Buyer enquiries in London fell at the fastest rate since
"The shift in mood music among potential buyers in the
London market has been particularly pronounced but that is in a
sense consistent with the move to a more sustainable market in
the capital," said Simon Rubinsohn, RICS chief economist.
"Significantly, members now expect price gains over the next
year to be faster outside of the capital than in it."
Last month official figures showed London house prices rose
20.1 percent on the year in May - a record increase.
Bank of England Governor Mark Carney has said the housing
market represents the biggest domestic risk to Britain's
financial stability, so signs the market is pausing for breath
will likely be welcomed by BoE officials.
British house prices stagnated in July after strong growth
in June, cooled by tougher checks on mortgage lending, a
separate survey from mortgage lender Nationwide showed in July.
Speaking on Wednesday after the BoE published new forecasts
for the economy, Carney said the introduction of more stringent
mortgage affordability tests in April likely helped to slow
housing market activity - though this could prove short-lived.
But last week another lender - Halifax - said house prices
rose at the fastest annual rate last month since the start of
the financial crisis, contrasting with other recent surveys.
Looking ahead, RICS said surveyors expect price momentum to
remain "robust", at least in the near-term. Its sales-to-stock
measure of market slack rose to 41 in July, its highest level
since 2007. But RICS added that there were signs surveyors were
less bullish about price expectations over a five-year horizon.
(Reporting by Andy Bruce Editing by Jeremy Gaunt)