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Property Sales Hit Record Low Despite Growing Enquiries

Wed, 14 Jan 2009
House sales fell to their lowest level for 30 years last month, despite increasing buyer interest, according to the latest survey from the Royal Institution of Chartered Surveyors (Rics).

The Rics UK housing market survey has revealed December sales were at their lowest since the survey began in 1978, with estate agents selling an average of just 10.1 properties over the three months, compared to 10.6 in November last year.

The survey revealed that high mortgage rates were making it difficult for potential buyers to take advantage of falling house prices as lenders favoured those with large deposits.

Rics spokesperson Ian Perry said: "Buyer interest is now at levels not seen since 2006 but without mortgage finance the housing market is at a standstill and transaction levels at an all time low.

" First time buyers and owner-occupiers are now stuck in a market which does not fulfil their aspirations. The Government must act now to ensure that order is restored to the current chaos."

"A first step would be for the Government to provide guarantees for the new issuance of residential mortgage backed securities," he added.

"Without this help there is a real danger that homebuyers will be frozen out of the market, transaction levels and prices will fall to new lows, repossessions will increase and negative equity will become common place. Together this has the potential to push the country deeper into recession."

Despite this, the survey found interest in the housing market among Britons remains upbeat.

New buyer enquiries increased for the second consecutive month during December and at the fastest pace since August 2006, as the combination of lower house prices and interest rate cuts tempted potential buyers back to the market.

In addition, the number of surveyors reporting house price falls decreased slightly in December with 73.5 per cent more chartered surveyors reporting a fall than a rise, down from 75.8 per cent in October.
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