House prices drop for eighth month

HOUSE prices in East Anglia are falling more sharply than in most regions in the UK, a new report has revealed.A survey by the Royal Institute of Chartered Surveyors (RICS) says property prices in the region dropped for the eighth consecutive month in February and at the fastest pace in the report's history.

Danielle Nuttall

HOUSE prices in East Anglia are falling more sharply than in most regions in the UK, a new report has revealed.

A survey by the Royal Institute of Chartered Surveyors (RICS) says property prices in the region dropped for the eighth consecutive month in February and at the fastest pace in the report's history.

The number of new buyer enquiries also fell sharply last month while new vendor instructions declined for the third month in a row - and at the fastest rate since October last year.

The RICS said confidence in the price outlook is close to the most negative level in the survey's history, although it slightly improved last month.

However, sales expectations were positive for the first time since June 2007.

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The RICS' figures are based on the activity on the ground as experienced by its chartered surveyors.

RICS spokesman, Ian Perry, said: “Confidence in the market is clearly having an effect on prices.

“A combination of a lack of available finance and weakening demand is causing a slow drop in capital values.

“While there is very little new supply coming onto the market, it is unlikely that there will be significant price drops in the short term but the build up of unsold stocks will encourage buyers to negotiate lower asking prices.”

A total of 61% of chartered surveyors in East Anglia reported a fall rather than a rise in house prices last month, according to the report.

David Knights, from chartered surveyors David Brown, based in Ipswich, said: “The market is still very difficult. There are buyers about, but very fussy and not inclined to make reasonable offers.

“There have been surges of optimism but vendors' expectations are still unrealistic and agents are still overvaluing and a few cutting prices to attract instructions.”

David Boyden, from Boydens, based in Braintree, said there were increasing levels of viewers as spring arrives but very little “proceedable” activity.

“Interest rates have made very little difference,” he added,

David Burr, from David Burr chartered surveyors in Long Melford, near Sudbury, said: “Things are not as bad as the press make out. There is enough equity in the market to keep things ticking along nicely.”

Christopher Philpot, from Lady Scott & Knight, Stowmarket, said: “The market has potential with good levels of enquiries and instructions.

“The current difficulty is putting deals together and getting commitment from both buyers and sellers who are not confident of the economic situation.”

Nationally, the balance of chartered surveyors reporting house price falls increased to near historical levels in February and stock piles rose to levels not seen for a decade

A total of 64.1% more chartered surveyors reported a fall rather than a rise in house prices, an increase from 54.8% in January. This figure is close to the historical low of June 1990 when 64.5% of chartered surveyors reported a fall in house prices.

The stock of unsold property on the surveyor's books jumped more than 8.5% last month, the fifth consecutive monthly increase in excess of 8%.

A total of 37% more chartered surveyors reported a fall than a rise in new buyer enquiries, down from 35% in January.

The RICS said many would-be-buyers are either struggling to raise the necessary finance for a move or are exercising caution in light of current economic uncertainty.

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