Old UK House Prices Forecasts and Predictions in the UK from Mortgagesorter at 25 Apr 2008

House Price Forecasts and Predictions in the UK at 25 April 2008

UK House Prices Situation: Prices still high but weakening nationally

UK House Prices Forecast: 5% - 10% fall in prices over the next 18 months

Surveyors Report Worst Results Since 1978

The RICS monthly survey of chartered surveyors has found that 78.8% more surveyors reported falling prices in March than rising prices.

The results are the worst since the survey began in 1978 and are markedly worse than February's results, in which 65.7% more surveyors saw a fall in prices than a rise in house prices.

The number of new buyer enquiries fell for the sixteenth consecutive month, agreed sales were also down by 20% and new instructions to sell also fell. This combination of trends suggests that growing numbers of buyers and sellers are happy to sit tight for the time being and see what happens - and shows that forced selling by people in financial difficulties has not yet become a problem.

Commenting on the survey's results, RICS spokesman Jeremy Leaf said that "The slowdown in prices is directly attributable to a lack of available finance which has hit demand. However, until new [housing] supply increases dramatically a significant crash remains unlikely."

RICS believes that the primary cause of the falling demand is a lack of available mortgage finance - not a shortage of properties for sale. Indeed, the average number of unsold properties on each surveyor's books remained virtually unchanged in March.

Government House Price Figures Show Fall

The latest government housing figures show that house prices fell by an average of 1.6% in February, confirming the trends highlighted by the Nationwide and Halifax house price indices.

The figures, published by the Department for Communities and Local Government (DCLG) showed that the annual growth rate for house prices fell to 6.7% from 8% in January and that flat owners were particularly badly hit, with flat prices falling by 2.9% in February alone.

The DCLG's house price survey lags behind most other house price surveys because it uses data on completed mortgages, rather than mortgage offers. However, it includes data from 50 different mortgage lenders and is considered a fairly accurate reflection of housing market activity.

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

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