The housing market suffered a sharp fall in April according to a survey yesterday that cast doubt on hopes of a strong rebound following the end of the war in Iraq.
The number of chartered surveyors reporting falling prices outnumbered those seeing a rise for the third month in a row and by the largest margin in eight years. The Royal Institution of Chartered Surveyors (Rics) said further rises in northern regions had been partly offset by price falls across the South. However, there was a glimmer of hope as confidence among London surveyors hit its highest level in four years even though prices suffered a dramatic plunge.
Completed sales fell to a two-year low, the stock of unsold properties is in a one-year trough and prospective buyers didn't rush back into the market after the end of the war.
However, this was offset by signs of a nascent confidence within the market that the worst was over. Surveyors said on balance they expected sales volumes to rise over the coming three months for the first time this year. A Rics spokesman said: "I am not sure how seriously people thought the market might collapse but they now seem to be convinced it won't happen.
"With no pressure for forced property sales, due to steady unemployment and low interest rates, increases in new instructions are likely to stay muted in the months ahead."
Jeremy Leaf, Rics' housing spokesman and a north London surveyor, said: "We expect stable sales conditions to return this summer and have forecast an average 10 per cent rise in house prices in 2003."