Charles Haresnape has dismissed RICS’ proposals to cap house price rises at 5% per year as unworkable.
Haresnape (pictured), Aldermore Bank’s residential mortgages managing director, said: “I cannot see how the RICS proposals to cap house price rises at 5% per year would work. Furthermore, their proposal to introduce house price caps on a regional basis could lead to unintended consequences, potentially creating a postcode lottery system.
“Average house prices are rising at 5.4% annually but this is being driven primarily by London, while in many other regions of the UK house prices are flat or falling. London house prices are driven up by overseas cash buyers and the high demand for housing in the capital. It is therefore jumping the gun to be warning about a house price bubble at this stage.
“House price inflation can be controlled by increasing the supply of houses. If we build more new homes or convert existing empty buildings into affordable housing, this will put a natural break on house prices.”