House Prices Starting To Fall
Sector: General
10th August 2010
House prices are starting to fall, the latest survey by the Royal Institution of Chartered Surveyors (Rics) has said.It is the first time since July last year that its monthly survey has detected a downturn in prices.Rics said this was because more homes were being put up for sale, while inquiries from potential new buyers had fallen for the second month in a row.Buyers were finding it hard to get a mortgage, while fear of unemployment was putting off others, Rics added. "The fall in the Rics house price measure is broadly consistent with most other recent data that has been released," said Rics spokesman Ian Perry. "Significantly, the forward-looking price expectations numbers suggest that this softer trend will continue through the second half of the year. "However, agents are still generally optimistic about sales activity, which should benefit from more realistic pricing of properties," he added.
Prices to fall
The survey was based on questions to only 242 surveyors around the UK, who also work as estate agents, but the Rics report has traditionally had its finger on the pulse of the property market. While 64% of those surveyed had not seen any change in local house prices during the preceding three months, those who had seen rises - 11% - were outnumbered by the 25% who had seen prices drop. Recent surveys from both the Halifax and the Nationwide have also shown that the upturn in house prices, which started in the spring of 2009, has been cooling off. That rise had been driven largely by a shortage of homes being put up for sale, but now the balance of supply and demand has reversed. Rics said its members expect the downward pressure on prices to continue. "Expectations for house price increases have also turned negative, with 28% more surveyors expecting prices to fall over the coming months," Rics said.
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