Lowest house prices for 30 years according to Rics

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by Lin Freestone

The Royal Institution of Chartered Surveyors has reported that house sales continued to fall during August, and are at their lowest level since its monthly survey started 30 years ago in 1978.

The holiday month of August is a traditionally slow period for property sales, added to which buyers were waiting for the speculated suspension of stamp duty.

However, the rate at which prices have fallen has continued to slow down for the fourth consecutive month.

The continued shortage of mortgage funds is stifling buyers. A Rics spokesman, Jeremy Leaf, said more help was needed to revive the market, and called on the government to step in to help mortgage lenders. Estate agents are selling an average of just one home a week.

He warned that the Government’s stamp duty policy will not be enough to kick-start transactions and is more likely to assist buy-to-let investors with better access to finance than the first-time buyers at whom it was aimed.

The Council of Mortgage Lenders has published figures that show the number of first-time buyers entering the market fell to a new low in July, with just 17,300 new buyers receiving mortgage approvals, compared with 33,100 in the same month last year.

More needs to be done to reinvigorate a market whose confidence has taken a severe knock.