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RICS figures suggest housing market is on the way down
18 September 2007 13:52
House prices have fallen for the first time in two years, according to the Royal Institution of Chartered Surveyors (RICS), as high interest rates continue to limit affordability.
Its findings showed that 1.8 per cent more chartered surveyors reported a fall rather than a rise in house prices in August, the first decline announced since October 2005 and a marked change from the 10.8 per cent majority of surveyors recording increases in July.
RICS attributed this trend to borrowers being discouraged by rising interest rates, which it found to be especially pronounced in the West Midlands, the north-west and East Anglia, although the London market continues to perform strongly.
There was also a fall in the number of new buyer enquiries for the ninth month in a row, with 37 per cent of surveyors noting this to be the case, compared to just 27 per cent who recorded an increase.
Ian Perry, a spokesperson for RICS, explained that rising rates have encouraged caution among homebuyers concerned that growing repayments could take an unmanageable toll and predicted that the market would decline further going into the autumn.
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