UK House Prices Situation: Weakening almost everywhere

UK House Prices Forecast: Government expects 5% - 10% fall this year

RICS Housing Survey: April Figures Worst Ever

New figures published this week by the Royal Institution of Chartered Surveyors (RICS) shows that sentiment amongst estate agents and chartered surveyors is at its lowest since the survey began, in 1998.

A 95.1% majority of surveyors reported falling prices rather than rising prices, confirming that house prices are weakening almost everywhere in the UK. Note that this figure does not indicate the scale of price falls, just how widespread they are.

Interestingly, however, the balance of unsold properties per surveyor - the number of homes for sale on estate agents' books - actually decreased slightly in April. This suggests that homeowners are not yet panic selling and should be seen as a positive. A reduced stock of houses should help control the rate at which prices fall, whereas a sudden increase in unsold stock would undoubtedly result in a more rapid, uncontrolled fall in prices.

Enquiries from new buyers and agreed sales dropped slightly in April too, probably reflecting the restricted state of the mortgage market and falling buyer confidence.

Government Expects 5% - 10% Fall in 2008

A private government document which was accidentally made public this week has revealed that the government expects house prices to be "at best down 5%-10% year on year" by the end of 2008.

This is broadly in line with forecasts from major mortgage lenders like Halifax and Nationwide, who in recent weeks have adjusted their house price forecasts downwards for the remainder of the year.

DCLG Figures Show 0.1% Increase in Prices in March

New figures from the government Department for Communities and Local Government (DCLG) show that house prices rose by 0.1% in March. The DCLG figures lag behind indices such as Nationwide's, but provide an accurate reflection of completed sales and historical house price movements.

Read our take on the Credit Crisis the effect on UK House Prices and Mortgages. A Special Report

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