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British house prices pick up more than expected in February – RICS

LONDON, March 12 – British house prices rose more than expected in February, according to a survey that suggested a growing shortage of properties might herald the end of a slowdown in the market.

The Royal Institution of Chartered Surveyors (RICS) said its monthly house price balance rose to +14 in February from +7 in January, above all forecasts in a Reuters poll of economists.

The index measures the assessment of surveyors of whether house prices have risen or fallen on an annual basis over the previous three months.

Britain’s housing market has been slowing since mid-2014, when regulators required banks to make closer checks on whether borrowers would still be able to afford mortgage repayments if interest rates rise sharply.

RICS said London was the only part of the UK where house prices fell, although the rate of decline eased.

“It is encouraging that the negative trend in buyer enquiries appears to be dissipating, perhaps in part because of growing confidence that the cost of borrowing will stay lower for longer,” said Simon Rubinsohn, RICS chief economist.

“(But it is) more worrying that instructions to sell property continue to drop.”

He said this highlighted the challenge the next government following national elections in May will have in addressing a housing shortage crisis.

House prices are likely to rise on average by a further 30 percent in London over the next five years, according to respondents in the RICS survey.

Some other surveys of house prices have shown little sign that the slowdown in Britain’s housing market is ending.

Mortgage lender Halifax said house prices fell in month-on-month terms in February for the first time since October.

(Reporting by Andy Bruce; editing by William Schomberg)

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