UK house prices still falling

UK house prices continued to fall in June according to a report by the Royal Institute of Chartered Surveyors (RICS).

The report blamed the fall on a market weakened by uncertainty surrounding the Eurozone crisis, slower demand for property and the end of the stamp duty holiday in March.  The statistics prompted RICS to say that the market remained ‘in the doldrums.'

Of the surveyors who took part in the report, two thirds said that house prices had failed to increase in the second quarter of 2012, making it the most pessimistic data for the past 8 months.

Confidence in the outlook for the next year was also low with nearly 20% more surveyors saying that they expected a fall rather than a rise in prices.

Compounding the indictors of a market in decline, newly agreed sales also slowed for 3 consecutive months with 12% more surveyors reporting falls compared to only 5% in June.

There was slightly increased optimism, in the number of surveyors expecting sales to go up in July with 11% more predicting an increase, compared to only 9% in May.  The RICS commented:

“Although there is some positivity that the amount of sales going through is going to see an increase, it is unlikely that we will see any real movement until purchasing a property is more affordable and accessible for the likes of first-time buyers.”

Andrew Cross from Arcus said, “Whilst the fall in prices is undoubtedly indicative of reduced demand on the back of wider economic troubles, other contributory factors such as the unwillingness of the banks to provide accessible mortgage finance and the FSA Compliance squeeze on mortgage intermediaries are also having an effect.”

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