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RICS: House price falls could have wider impact
12 June 2008 10:30
House prices fell again last month, new figures from the Royal Institution of Chartered Surveyors (RICS) have shown, which could have wider repercussions for the economy.
In May, 92.9 per cent more surveyors reported a fall rather than an increase in property prices, a slight improvement from April's 94.7 per cent gap, but still a worrying chasm, with surveyors in East Anglia and the south-east unanimous that prices were falling.
Moreover, there were just 17.4 transactions per surveyor over the past three months, the lowest ratio in 30 years, while 51 per cent more surveyors recorded a decrease rather than a rise in new buyer enquiries, although this was down from a gap of 69 per cent in April.
RICS spokesperson Jeremy Leaf warned that with demand weak and housing sales declining, there is a danger that the impact of the credit crunch could spread beyond the property market, including into the retail and construction sectors.
Yet the National Association of Estate Agents responded by stressing that house price movements vary regionally and asserted that property market activity would pick up again if the current restrictions on mortgage lending could be alleviated.
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