Biggest rise in house hunters for three years but property prices continue to fall, says RICS

The biggest rise in house hunters for more than three years was recorded last month, as the property market started to show flickers of life, the latest Royal Institution of Chartered Surveyors report said

Improving mortgage rates and a slight boost to confidence delivered an upturn in property market activity in October, RICS members reported.

But house prices are falling in all regions except London and the South East and the capital’s property market has lost some of its head of steam.

RICs reported that its member agents had seen the biggest rise in new buyer enquiries since December 2009, with 18 per cent more reporting rising rather than falling enquiries, up from 5 per cent the previous month.

Meanwhile, home sellers are also testing the waters, with RICs reporting that 12 per cent more members reported a rise in new sales instructions compared to 5 per cent the month before.

The report said the risk to house prices and activity were easing, however, it was, ‘still far too early to call an end to the housing market stalemate.’

Ian Perry, of RICS, said: ‘The number of potential buyers going out and viewing property saw a welcome boost last month. It seems that with Christmas around the corner, those who are in a position to buy decided to get out there and see what is available.

‘That being said, overall activity is still very low in most parts of the country and what the market desperately needs is for this to translate into actual sales.’

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House prices continue two-year slump to slide back towards 2009 lows, reports Halifax

Posted By TPBC Staff

House prices fell more than £1,000 in October as the property market continued to slide back towards the lows seen during the property slump three years ago, Halifax has reported.

The average home dipped by 0.7 per cent in value during the month to £158,426, just 2.4 per cent above the £154,663 low seen in April 2009.

Sharp falls have been arrested in recent years but a two-year slide on the Halifax index has seen it lose almost all the gains seen after house prices bounced back in 2009 and 2010.

The latest Halifax report, based on its mortgage data, showed house prices down 1.7 per cent annually and that they have been falling year-on-year since October 2010.

The average home is now worth £41,186 less than the £199,612 recorded at the peak of the market in August 2007 – representing a 20.6 per cent drop.

Martin Ellis, Halifax’s housing economist, said: ‘Signs of a modest deterioration in the trend in house prices continued in October. Prices in the three months to October were 1.2% lower than in the preceding three months.

‘The weak economic background has been a key factor dampening housing demand this year. Recent encouraging developments relating to the level of overall economic activity and conditions in the labour market, however, may help to support demand and underpin house prices around current levels over the coming months.’

The downbeat Halifax update echoes a report by property listing website RightMove that claimed nearly a fifth of homeowners who bought their property in the last five years are now saddled with negative equity.

It said that 17 per cent of people who purchased a home since 2007 have a mortgage balance bigger than the value of their home.

The most recent Land Registry figures, which are based on transactions, recorded house prices in England and Wales up 1.1 per cent to an average of £162,561 in the year to September.

However, this continues to be skewed by London prices, which were up 5.5 per cent annually – more than twice as fast as the next highest rise of 2.3 per cent seen in the South East. Property prices rose in four of the regions surveyed and fell in the other six.

Peter Rollings, CEO of upmarket London estate agent Marsh and Parsons, said that it will be some time before the overall national property market returns to health. He said: ‘Halifax’s figures portray a downbeat performance from house prices in recent months, and reflect the troubled state of the national housing market.

‘Buyers’ spending power is still squeezed, with wage inflation still lagging behind the growing cost of living, and while there are signs that mortgage lending is beginning to head in the right direction, it will be quite some time before it returns to the level needed for significant improvement in the number of buyers able to move home each month.”

‘The tale is very different in London. While house price growth has been steadying in recent months, prime areas in the capital are still seeing double digit annual growth as a result of the demand from wealthier equity rich buyers, and this is helping support the average national house price.’

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