Decline in UK house prices slows in October

October saw the largest increase in United Kingdom new buyer enquiries in two years and marked the fourth consecutive month of increases says the RICS’ (Royal Institution of Chartered Surveyors) housing market survey released November 15.

Although house prices slipped back again last month, the pace of decline was at its slowest in 15 months. The number of chartered surveyors reporting price falls for October dropped significantly to 9%, down from 21% in September.

Buyer interest is still benefiting from August’s interest rate cut, though the upturn in demand has only partially made up for previous declines. Sales activity is seeing a modest increase and completed sales have risen almost 8% from their low in February, though they are still down 5% from levels one year ago.

With sales rising and new selling instructions at a standstill, the stock of available property on surveyors’ books has also fallen and is down four percent in the past three months.
Buyers still retain the balance of power, though this is beginning to shift as the recovery has been sustained.
Surveyors’ outlook for the market remains positive in contrast with most of the past year.

The recovery in buyer interest in recent months has led to predictions of modest price rises in seven regions for the next three months.

House prices have either stabilised or declined slightly across southern England. They have continued to slip in the north and Midlands, but rises have been recorded in Scotland and the North West.

For the first time in almost 18 months, price increases were also seen in London.

According to RICS spokesperson, Jeremy Leaf: “This month has seen further evidence of a pick up in the market with the recovery in would-be buyer interest. Contributing factors include diminishing uncertainties over the future of interest rates and rising employment, which is lifting the demand for homes.

"The return to more balanced market conditions is welcome, though negotiations between buyers and sellers remain hard, and over-priced property continues to remain unsold.
"A return to boom conditions is not at all evident."
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