Decline in UK House Prices Accelerates in November, RICS Says

on Dec 11, 2012
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**British House Prices Decline Faster Than Expected**

Following several months of steady improvement and October’s slowest pace of decline in more than two years, house prices in the United Kingdom dropped in November, according to the latest data out today from the Royal Institute of Chartered Surveyors (RICS). The trade body’s house price gauge moved down to -9 points, where readings above the zero point mark indicate successively quicker rates of increase. After a reading of -7 in the previous month, the consensus estimate had been for the index to have remained unchanged.

RICS global residential director, Peter Bolton King, pointed at the current economic uncertainty as a major reason for the faster than expected UK house prices decline. He said: “The macroeconomic picture continues to weigh heavy on the market and continues to prevent any really significant boost in activity.”
**Northern Ireland and Wales Mark Sharpest Drops, London Stays above Trend**

Citing the influential poll of RICS surveyors, The Financial Times reported on 11 December 2012 that house prices in Northern Ireland and Wales experienced the sharpest drops. Meanwhile, prices in the UK capital continued to outstrip those in other regions. London and the South-East of England were also the only areas where prices are expected to increase over the next three months, the survey shows.

While 9 per cent more RICS surveyors reported falling UK house prices, as opposed to stable or rising prices, during November, in Northern Ireland and Wales, the balance reporting falling prices was far higher, at 49 and 36 per cent, respectively. However, London properties, considered a safe haven for global investors, experienced an increase in prices with 40 per cent more surveyors reporting improvement rather than stable or falling prices.

**“There Is Certainly Some Optimism Creeping Back”**
!m[Royal Institute of Chartered Surveyors’ Poll Shows Buyers’ Interest Fails to Halt Dip in House Prices](/uploads/story/1009/thumbs/pic1_inline.png)Despite the general house prices trend in Britain, prospective house buyers’ interest climbed last month across most parts of the UK. Enquiries by potential buyers rose for the third month and are now up 11 per cent since the end of the summer, suggesting the Bank of England’s (BoE) Funding for Lending Scheme (FLS) — the latest flagship initiative to boost lending and cut borrowing costs — is helping to provide much-needed capital for UK property buyers. RICS’s poll also showed that property sales inched moderately higher, with surveyors selling an average of 15.8 homes in November, up from a revised figure of 15.4 last month.
“There is certainly some optimism creeping back into the housing market, and it is encouraging to see an increase in potential buyers across parts of the country where the market has particularly suffered in recent years,” Mr King said, adding: “The announcement in last week’s Autumn Statement of funding to unlock large sites for house building is a step in the right direction, and the Funding for Lending Scheme is beginning to bear fruit for potential buyers.”

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