House prices continue slow fall

The housing market in May was broadly stable according to the latest data from the RICS, albeit with the balance of areas recording price falls declining slightly.

In the RICS’ latest monthly update, it said that the balance of areas recording price rises or falls had moved from -19% in April to -16% in May, meaning price falls were slightly less widespread.

However, the survey found that the loss of momentum in the housing market seen since the expiry of stamp duty exemptions in March has continued, with the average number of sales per estate agent branch falling to 15.6, new buyer enquiries slipping in to negative territory, and expectations of future house price rises weakening.

London remains the only region to see more surveyors recording rising prices than falling, with price falls most widespread in Wales and the West Midlands over the month.

Overall, the RICS said the news meant that the number of sales per branch remained at a level 40% down on the figure pre-credit crunch, which it said illustrated the extent to which market activity has fallen in recent years.

Peter Bolton King, RICS housing spokesman, said: “It’s no surprise to see such a sizable drop in transactions since the market peak back in 2007. Ongoing economic instability in the UK and overseas has continued to undermine consumer confidence, and the reluctance of many banks to offer affordable mortgage products has created something of a stagnant market.

“In spite of this, a gradual stability is returning to the market and surveyors expect transaction levels to increase over the coming months, even if prices continue to dip across most parts of the country.”