More surveyors seeing house prices falling rather than rising, report finds

The proportion of surveyors seeing house prices falling rather than rising has grown to its biggest level since 2012, a report has found.

A net balance of 10% more surveyors saw house prices falling rather than rising in October, the Royal Institution of Chartered Surveyors (Rics) said.

Rics said this is the weakest reading on its price growth measure since September 2012, when a balance of 17% of surveyors reported falling rather than rising prices.

The overall price indicator had also been falling in September this year – but only to a small extent, with a balance of 2% of surveyors seeing falling prices.

The current weakness stems mostly stems from London and the South East.

East Anglia, the South West and the North East also saw negative price balances, but prices continue to rise in other parts of the UK, with the strongest growth in Northern Ireland and Scotland, the report said.

Homes in the highest price brackets are selling noticeably below the asking price, while properties listed at £500,000 and below are relatively steady, the report said.

For properties marketed at more than £1 million, close to three-quarters of surveyors said sales prices were coming in below asking prices – and 14% said sales prices were on average more than 10% below the initial asking price.

Surveyors in London and the South East continue to give a negative assessment on the prospects for house prices over the coming year, Rics said.

By contrast, house price expectations for the next 12 months remain upbeat in the North West of England, Northern Ireland and Scotland.

Rics said the average number of homes on estate agents’ books remains very close to an all-time low.

Simon Rubinsohn, Rics’ chief economist, said downbeat assessments of the housing market continue to “disproportionately reflect developments in the South and East of England with the picture remaining rather more resilient in many other parts of the country”.

He continued: “Uncertainty about the economic outlook on the back of the never-ending Brexit negotiations appears a key drag on sentiment.”