House prices are still rising as demand continues to outstrip supply in London, according to a new survey.
Continued house price growth in the capital was caused by fewer instructions to sell and rising buyer demand, according to the latest RICS UK Residential Market Survey.
Looking at the UK as a whole, the RICS price indicator reached a 16-month high in August, with a net balance of 53% more respondents reporting price rises and firm growth being seen across all areas of the UK.
In London 34% more respondents saw prices rise over the last three months, with 38% more expecting prices in the capital to rise in the next three months.
Data from the ONS indicates prices across the UK now look likely to rise by around 6% over 2015, compared with 3% predicted at the beginning of the year.
Simon Rubinsohn, RICS chief economist, said: “Given current market conditions, the latest data unsurprisingly shows house prices continuing to rise, and at an accelerating pace.
“As such, house price inflation across the UK has now quickened in each of the last seven months following a sustained period of easing towards the latter half of 2014.
“And there is good reason for this trend to be sustained into next year, however uncomfortable that may be for those looking to enter the market, given that so many of our members are telling us that they are struggling to replace the stock they have sold.”
In the lettings market, tenant demand rose at a steady pace for the eighth successive month, outstripping the modest pick-up in new landlord instructions once more in the process. Rents are therefore expected to increase, with 34% of respondents predicting a rise in rents during the next three months.