House sales at lowest level on record

According to the Royal Institute of Chartered Surveyors (RICS) Housing Market Survey for December 2008, published today, the number of completed sales per surveyor fell to less than 1 per week.

The survey assesses the completed sales over the previous 3 month period and in December it fell to 10.1, the lowest level since the records began in 1978.

Surveyors continued to report house price falls. Although the net position between surveyors reporting falling and rising prices improved slightly, the balance is still strongly negative with prices falling.

Some slight improvement in buyer interest was reported. This was believed to be due to the Bank of England base rate cuts and fall in house prices making property more affordable.

The survey findings were supported by comments from surveyors, including Andrew Granger of Andrew Granger & Co, Leicestershire:

‘Low interest rates are certainly attracting potential buyers to the marketplace, but they are only committing if the purchase price is appealing. Buyers are concerned that prices might fall by a further 10-15% during 2009. FTB’s (First Time Buyer’s) and those buyers who have moved temporarily into rented accommodation are closely watching the market to assess when prices might level off.’

However, despite the fall in the base rate, many surveyors commented that difficulties in obtaining mortgage finance is making property sales difficult, causing some sales to fall through and others to take longer.

According to the surveyors, these difficulties, coupled with rising unemployement issues, are leading to further house price falls and inevitably increased distressed sales and sales following property repossessions.

The Housing Market Survey was conducted between 15 Dec 08 and 2 Jan 09 and the results cover responses from 299 surveyor offices who responded to the survey questionnaire.