House prices falling and further drops expected

A balance of 24 per cent more surveyors reported falling rather than rising prices last month, the most negative reading since June 2011, the Royal Institution of Chartered Surveyors (RICS) said.

London, which has had strong interest from overseas buyers, is the only region where more surveyors reported price rises than falls.

The West and East Midlands and Yorkshire and Humberside were the areas where surveyors were the most likely to report prices falling.

The start of the school holidays meant activity in the market tailed off further, with the number of new sellers coming to market declining for the third month in a row, while demand from buyers remained broadly flat, the study said.

RICS said it had found marked regional differences however, with the North and North West regions seeing demand from buyers generally rising over the last four months in a row, while demand has either been unchanged or dropped off elsewhere.

Some 15.1 sales per surveyor were recorded over a three month period, the lowest figure seen since October last year.

RICS said that the difficulties many buyers are having in getting a mortgage has contributed to the drop in transactions.

Sales are expected to pick up slightly in the next few months, but both prices and sales figures are likely to show a deterioration in the next year, the study found.