UK July house price growth picks up slightly-RICS

UK July house price growth picks up slightly-RICS

LONDON, Aug 14 (Reuters) - British house price inflation picked up unexpectedly last month but new buyer enquiries fell and surveyors' confidence in the price outlook hit its lowest in more than two years, a survey showed on Tuesday.

The Royal Institution of Chartered Surveyors said 12.6 percent more surveyors reported a rise in prices than a fall in the three months to July, up from 10.6 percent in June which had been the lowest since January last year.

Analysts had forecast a further weakening to 8.8 percent.

Strong house price gains in London and Northern Ireland led the small recovery although the overall price balance remained below the survey's long-run average for a second month.

Forward-looking indicators suggested the recovery may be short-lived, however. New buyer enquiries declined at the fastest pace since August 2004 and surveyors' confidence in the price outlook fell to the lowest level since June 2005.

The ratio of completed sales to the stock of unsold property, seen by many economists as a more reliable indicator of demand, fell for a fourth consecutive month, to 37 percent from 38.9 percent in June, its lowest in a year.

"Buyer activity has pulled back a little over fears that we may have seen the top of the market," said RICS spokesman Jeremy Leaf.

"With interest rates perched at 5.75 percent and a jump to 6 percent a strong possibility, aspiring first-time buyers are continuing to rent until the market trend becomes clearer."