Estate agents report a fall in house prices across the UK ending more than two years of growth

According to the latest RICS survey, real estate agents reported a decline in home prices across the country in October, ending a 28-month run of rising home prices.

In September, the survey, which includes the opinion of RICS member brokers in the UK, revealed a net positive rating of 30 percent when asked about house prices, while in October it felt sharp to minus 2 percent.

RICS calculates net ratings by taking the number of agents reporting a price drop from those reporting an increase. For example, if 30 percent reports an increase and 5 percent reports a decrease, the net balance would be 25 percent.

However, the global figure masks regional price differences. Respondents to the survey in areas such as East Anglia and the South East of England were more likely to see price falls, with net balances of -31 percent and -16 percent, respectively.

Conversely, respondents from Northern Ireland and Scotland continued to report an upward trend in house prices, even though the growth rate was slower than earlier in the year.

Looking ahead, on balance, respondents in all parts of the UK now believe that prices will fall somewhat over the coming year.

The October rating suggests that “house price growth is coming to a halt,” commented in the survey.

At the same time, buyer inquiries fell to minus 55 percent for the sixth straight month, even beyond the negative 36 percent in September.

In addition, the number of investigations fell for the second month in a row in all regions of the UK.

Home prices fell across the country in October according to RICS brokers

Buyer demand has fallen in the UK, according to RICS, the second month they have fallen

Simon Rubinsohn, chief economist at RICS, commented: “The latest feedback on the RICS survey provides further evidence of caution among buyers in light of the sharp rise in mortgage costs.

As a result, activity volume is likely to decline in the coming months and realistic pricing is now much more important to complete a sale.

The calm in the financial markets could offer some relief, although it may be premature to assume that this will be reflected in a reduction in lending rates in the near term. However, the employment picture remains critical for the medium-term outlook and remains solid for the time being.’

Broker Savills has predicted that prices will fall by 10 percent next year and rise by 1 percent in 2024. In May, the broker only forecast a 1 percent decline in 2023, but the sharp rise in mortgage rates has led to a bleaker outlook.

Simon Wall of Stephanie Macnab Estate Agents, said: ‘The steam has definitely left the market here, although activity remains at what would otherwise be considered reasonable levels.

“There is greater buyer strength with tougher initial negotiations and renegotiations after investigation. Hopefully the easing of the economic outlook will improve things.

“At the same time, the number of new offers entering the market also continues to decline, with a net balance of -17 percent of respondents nationally citing a decline.”

Marion Currie of the Galbraith Group in Dumfries and Galloway, Scotland, said that while there is still a lot of interest in available housing, interest in winter is waning.

“The pool of buyers who have missed out on other properties in the past two years is still there, but decreasing,” she added.

In the rental market, rents are expected to continue to rise as tenant demand continues to grow at a brisk pace, with a net balance of 46 percent of survey participants noting an increase in October.

At the same time, however, landlords’ instructions fell again according to a net balance of -14 percent of respondents.

In a year from now, the respondents expect rents to have risen by about 4 percent nationwide