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House prices slip lower as surveyors remain pessimistic
House prices dropped and activity remained flat in July as the property market continued to stall, according to the Royal Institution of Chartered Surveyors.
Markets
House prices edged lower in July as the property market continued to stall, according to the Royal Institution of Chartered Surveyors (Rics).
Some 22% more surveyors reported that prices fell rather than rose in July. Prices have remained negative now for over a year.
With prices continuing to slip, people are unwilling to sell at reduced prices, Rics said. The average number of sales per surveyor dropped to 14.2 – the lowest level since June 2009. Surveyors also reported less houses coming onto the market, while interest from new buyers similarly dipped.
London however continued to buck the national trend as the only region to report price rises. The capital also reported the strongest level of new buyer enquiries.
Ian Perry, spokesperson for Rics, said: ‘While the holiday season appears to have had some impact on the market, the continual problem of inaccessible mortgage finance is still preventing first time buyers from accessing the market’.
Chris Gardner of mortgage website Obligo.co.uk, meanwhile said: 'A flat market is no surprise given the embattled consumer and still weak demand. In fact, flat could even be construed as a positive given the state of the domestic and global economy'.
'London remains resilient and there will always be other sought-after areas outside the capital that perform but overall the picture has to be of a market that is slowly falling further into the red,' he added.
Looking ahead, Rics warned that pessimism still surrounds future house price expectations with 13% more surveyors predicting prices will continue to fall rather than rise over the next three months. Sales expectations however are rather more upbeat, with 15% more surveyors predicting sales to rise.
Reports earlier this month from Hometrack and Rightmove also claim house prices fell in July, and both warned prices will continue to fall in the coming months. Halifax and Nationwide however both reported a small rise in prices, though expect prices to remain flat for the rest of the year.
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8 comments so far. Why not have your say?
Anonymous 1 needed this 'off the record'
Aug 09, 2011 at 12:37
I think the market will remain in doldrums for quite some time. The main ingredient-confidence- is simply not there and the recent upheavel in the financial markets followed by roits will not help. It takes time to build confidence and takes no time to destry it.
We are in it for a long time. In the mean time, can any one suggest where we can buy patience.
report thisAnonymous 2 needed this 'off the record'
Aug 09, 2011 at 12:58
Economic growth is low, salary growth is negligible, unemployment is high, governement spending is down, consumer debt is already high and commodity inflation has emptied what is left in peoples pockets.
Who in their right minds is going to strectch themselves to buy a house anymore. Prices have only got one way to go, they may not crash (due to low interest rates) but they are certainly not going up.
London remains the exception to the rule (due to foreign money distorting the market), but the inequalities there between those who can buy 10 houses and those who can't buy one is being played out in the streest as we speak.
report thisNigel Sprigings
Aug 09, 2011 at 13:58
Mortgage unavailability is comonly cited as a reason for the slow housing market. However no-one is explaining why there are'nt many mortgages, especially for first-time-buyers. My hunch is that the lenders are deliberately restricting lending to higher value property and the main reason for this is so they can report average house prices (based on transactions) remaining reasonably high. If there was a lot of lending to first time buyers at prices they could afford then volumes would increase and average sales values would fall. This would wipe billions off the "asset book" value of lenders portfolios and they'd be bankrupt again.
This is why BTL lending is expanding, landlords have cash for larger deposits and almost guaranteed income. They are the only people in the market who can afford to hold values high, thus protecting the lenders assets.
report thismark douglas
Aug 09, 2011 at 14:42
I wonder what will happen if ever interest rate ever rise. Will they?
report thismark douglas
Aug 09, 2011 at 14:45
I wonder what will happen IF interest rates rise.
report thisDislexic Landlord
Aug 09, 2011 at 15:49
well im i Suprised IM NOT
The market has futher to fall we all know that if you dont your on another planet
For Landlords its a fantastic market lending is getting better
Tenant demand is very good 10% gross yeilds are the norm
Im not sure where the bottom of the market is but im happy to follow it down
report thisFranco
Aug 09, 2011 at 16:45
Can some one please tell me where I can find the Halifax House Price Index on the Internet?
I spent a whole evening searching for it and never found it.
report thisalan franklin
Aug 09, 2011 at 17:33
Interesting report, Victoria. However, when you write: "Surveyors also reported less houses coming onto the market," you mean "fewer" houses.
Best to get the difference sorted out while you are a young journalist, then there will be fewer errors and less need for correction.
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