Market hasn't been this depressed since 1978, say surveyors

Confidence in the UK housing market has fallen to its lowest point in 30 years, according to property surveyors.

The Royal Institution of Chartered Surveyors (Rics) said 78.5 per cent more of its members reported a fall rather than a rise in prices in March. This marked the eighth consecutive monthly drop and made for the gloomiest reading since the survey began in 1978.

Property surveyors now say the next six months will be crucial for homeowners and would-be buyers.

Jeremy Leaf, a spokesman for Rics, said the gloom was the result of the credit crunch, which was stopping mortgage providers from lending to each other: "Sentiment will continue to remain depressed while the economy suffers from this unique liquidity blight."

But he added that a crash in prices still remained unlikely.

The survey also showed a decline in the number of people looking to buy; 49 per cent more surveyors reported a fall rather than a rise in new buyer enquiries, compared with 39 per cent in January.

The findings add to concerns raised by the Halifax, the UK's biggest mortgage lender, which reported a 2.5 per cent fall in house prices in March, the biggest monthly decline since 1992.