The first month of 2005 saw UK house prices fall further, but at an increasingly slower pace, according to The Royal Institution of Chartered Surveyors (RICS)’ monthly housing survey out today, Tuesday 15th February.

Surveyors also reported a slight decrease in property stock for sale, marking the first drop in eight months. However, the choice of available properties is still 16% higher than last year, indicating resolutely restrained market conditions. This has led to surveyors’ anticipation of modest price declines over the next three months.

January also saw a rise in newly agreed sales which are up for the first time since April last year following steady interest rate increases, although sales at completion stage are still static. Having declined significantly over the past six months, the number of new buyer enquiries has not changed. 36% percent of chartered surveyors reported a fall in house prices, two percent less than the previous month.

House prices continue to decline modestly across the country with southern England seeing the most marked falls. Prices in the Midlands and Northern England remained similar to the previous month. London prices remain stagnant with Scotland experiencing a modest rise.

RICS spokesperson, Jeremy Leaf comments:

‘Sellers remain unwilling to lower asking prices and, with buyers looking to secure a bargain, this has resulted in a rather slow recovery. The strength of the wider economy should support the housing market in the coming months, despite property becoming less affordable as a result of higher interest rates.

‘The market has most likely already hit its lowest point and we should see a recovery in activity, though the prospect of further interest rate rises will keep conditions restrained.’

Source : RICS