House Sales Accelerate Despite Shortage

House sales rose at their fastest rate for 16 months in September, helping to limit price growth, according to the Royal Institution of Chartered Surveyors (RICS).

The organisation's monthly survey found that growth in the availability of mortgage finance contributed to the pick-up in sales, which have been hampered in recent months by a lack of properties on the market.

The RICS said the North, East Anglia and Scotland posted the sharpest rises in sales but the number of new instructions had fallen in 13 of the past 14 months.

This has been partly blamed on economic uncertainty and worries about affordability.

Simon Rubinsohn, the chief economist at the RICS, said: "Unless the stock being sold is replenished there is a limit to how sustainable this modest improvement in market turnover will prove to be.

"Unfortunately, the indications are that we are locked in a cycle where the lack of available properties on agents' books is itself deterring some potential vendors from thinking about putting their own property on the market."

The Prime Minister used his speech at the Conservative conference in Manchester on Wednesday to demand a "national crusade to get homes built."

David Cameron promised an overhaul of Whitehall and town hall planning rules which he says prevent house builders from offering low cost, affordable home ownership.

Builders have cited planning laws as a major obstacle to new housing but the industry has also pointed to a skills shortage - caused by an exodus of labour abroad in the wake of the financial crisis which badly damaged the construction sector.

In a separate report on Wednesday, the Recruitment and Employment Confederation (REC) said plans to increase house building and upgrade the railways were under threat from a "critical" lack of specialist labour.