The Royal Institute of Chartered Surveyors’ housing market survey this month revealed that house prices have fallen for the first time since July last year when 16% more surveyors said values were falling than rising.
Last month saw 8% more surveyors reporting rising, not falling prices. Regionally, the only areas which continued to see material price rises in the past month were London and the North West.
RICS spokesman, Ian Perry, said: "The fall in the RICS house price measure is broadly consistent with most other recent data that has been released. This is a reflection of both the increase in supply following the scrapping of HIPS and the more cautious stance from buyers.”
Demand for property, measured by the net balance of new buyer enquiries, fell for the second month in a row, from -6 to -10. RICS said difficulty in securing mortgages and increased uncertainty about the prospects for the economy may have contributed to caution from potential homebuyers.
The number of new vendor instructions increased with 33% more surveyors reporting a rise rather than fall in properties coming onto their books, up from 28% in June. This is the highest reading since May 2007, the month before the initial planned introduction of HIPS.
In keeping with the trend of increased supply to the market, the average number of properties on surveyors' books also rose by 4.1% from June, taking the average to 69.1. While the average number of sales per surveyor stayed flat, at 16.6.
The sales to stock ratio fell to 24%, the lowest level since June 2009. Newly agreed sales remain largely unchanged, with 1% more surveyors reporting a rise than fall in the number of transactions, down from 3% in June.
Expectations for house price increases have also turned negative, with 28% more surveyors expecting prices to fall over the coming months, up from 6% in June. Despite this, sales expectations remain positive, with 8% more surveyors expecting sales to rise rather than fall, although this is down from the previous month.
Perry added: "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."
