More surveyors reported a fall than a rise in property prices last month

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by Kay Murchie

The Royal Institution of Chartered Surveyors (Rics) said surveyor gloom is near a record high, with the number of UK surveyors reporting property price falls last month close to the historic level of June 1990.

64% more surveyors reported a fall than a rise in house prices in February compared with 54.7% in January. Rics said cautious homebuyers has resulted in stockpiles to increase to levels not experienced for 10 years.

However, Rics also said the reverse is happening in Scotland with 25% more reporting price increases, a rise of 18%. The situation in Scotland reflected economic data coming out of the country, showing an increase in the balance of surveyors reporting price rises from 7% to 25%.

Furthermore, Rics said sales expectations among UK surveyors turned positive for the first time since last June.

Many house price surveys have all indicated a slowing market, but differ in their interpretation of the rate of decline.

Last week, the latest monthly survey by the Halifax established that property prices are continuing to slow down. The lender said prices across the UK fell by 0.3% in February, taking the annual rate of inflation down from 4.5% to 4.2%.

However, the Nationwide which registered its fourth consecutive monthly price fall, said prices in the 3 months to February had been 1% lower than in the 3 three.

Potential buyers are struggling to raise the necessary finance or sitting tight during the current economic uncertainty according to Rics. 37% more surveyors said new buyers’ enquiries were down than those reporting increases.

Ian Perry of Rics said confidence in the market is clearly having an effect on prices. While there is very little new supply coming onto the market, it is unlikely that there will be significant price drops in the short term but the build up of unsold stocks will encourage buyers to negotiate lower asking prices.