House prices fell at their fastest rate since 2009 last month as the ‘downward spiral’ continues, a new survey of estate agents and surveyors found.
The poll by the Royal Institution of Chartered Surveyors (RICS) of its members in August showed the most negative reading since February 2009 as demand from buyers and agreed sales fell sharply.
In contrast in the rental sector rents are being pushed up by a ‘yawning gap’ between demand and supply, RICS said.
A net balance of -68 per cent of those surveyed reported house prices had fallen in their region – falling from -55 per cent in July.
The net balance measures the difference between the percentage of surveyors seeing rises and falls in house prices.
Property prices will continue to tumble in the short-term in the face of higher mortgage rates with ‘little prospect of any turnaround in the immediate future’ Royal Institution of Chartered Surveyors (RICS) said (Stock Image)
House prices are dropping in almost all parts of the UK, with the West Midlands, East Midlands, East Anglia and the South East seeing the greatest falls, RICS said.
Northern Ireland remains the only area in which more surveyors report prices are rising than falling, the poll found.
The report follows Halifax’s latest index showing the average UK home is now worth £279,569 after seeing £14,000 wiped off its value in one year.
Property prices will continue to tumble in the short-term in the face of higher mortgage rates with ‘little prospect of any turnaround in the immediate future’ RICS said.
Demand from homebuyers remained subdued with net balance of -47 per cent of surveyors reporting a decline in enquiries over the month – the weakest reading since the start of the pandemic.
All parts of the UK continued to see a fall in demand from new buyers.
Meanwhile, demand for rental properties is soaring across the country as tenants compete for fewer properties and landlords sell up and leave the sector.
A net balance of 60 per cent of surveyors expect rental prices to be driven higher in the next three months, RICS said.
RICS chief economist, Simon Rubinsohn, said: ‘The latest round of feedback from RICS members continues to point to a sluggish housing market with little sign of any relief in prospect.’
Alec Harragin, director of Savills head office in London, added: ‘Whilst inflation seems to be on its way down, and mortgage rates may have peaked, affordability will remain stretched.’
