According to the nation’s chief surveyors’ body, house prices are not expected to see any significant increase during the coming year, as the property market continues to face significant challenges, due to weak economic growth, tax increases and high unemployment hampering buyers’ ability to pay.

In its official forecast of house prices and demand in the UK for next year, the Royal Institution of Chartered Surveyors (RICS) said there would only be a modest increase in prices, as little as 1 to 2%, even though more homes would be bought and sold in 2010 compared to 2009.

RICS believes, despite signs buyer interest has been steadily rising, outstripping supply of houses for sale, several factors will limit price rises, as considerable downside risks remain. According to the group, the number of properties for sale will increase during the early part of the year, however, supply will struggle to keep pace with demand, leading to further rises in price.

According to RICS analysis, the housing market came through the past year in better shape than the many 2009 predictions.

However, several trends in addition to general economic conditions will likely weigh on housing, with interest rates unlikely to remain at current low levels.

The re-imposition of stamp duty for lower-priced properties will also likely bear down on house prices, including an increase in national insurance contributions, as also higher tax rates for top earners.