The latest report from the (RICS) Royal Institute of Chartered Surveyors has found house price growth negative for the third month in a row: according to their latest figures 22.2% more surveyors reported a fall than a rise in house prices, down from 14.9% in September.
It also found that new buyer enquiries and newly agreed sales have also fallen, although new instructions have also lessened, while the supply side of the market remains tight and continues to provide support to prices.
Interest rate rises, the recent credit crunch and the subsequent tightening of lending conditions have all had an impact upon demand, says the report. New buyer enquiries fell for the 11th successive month, said surveyors, and weak demand has pushed the stock of unsold property up at the highest pace since May 2003.
These factors mean market conditions are looser than they have been for over a year. Ian Perry, RICS spokesman said: ?The housing market is seeing the awaited slowdown that many had been expecting, with modest falls across most UK regions. A decline in transactions may be in the offing as stalemate returns to the market.
However, things are still very different between the rest of the country and London, pointed out Mr Perry: ?Credit market turmoil has yet to put downward pressure on prices in the capital although prices have now stabilised even here,? he said. ?Significantly, London is the only region where new instructions have risen over the last two months.?
Although surveyor confidence is low, some economists were quick to point out this is to be expected, and results from surveyors do not always mean falls in prices. Kelvin Davidson from Capital Economics said: ?Today?s survey from the RICS shows that the slide in the housing market continues apace. In 2004/05, of course, the RICS data were weak, but house prices didn?t fall. As such, there may well need to be several more months of depressed RICS numbers until we see material falls in house prices on all the main measures.?