House price falls

House prices are continuing to turn down, says the Royal Institution of Chartered Surveyors (Rics).

Its latest survey says UK house prices in September generally fell again, with more of its members reporting a fall in prices locally than an increase.

It said enquiries from new buyers had fallen for the tenth month in a row.

Rics blamed the downward trend on a combination of factors, such as higher interest rates and lenders tightening their lending criteria.

"A major correction in the market seems unlikely while economic growth is above trend and employment conditions remain buoyant," said RICS spokesman Jeremy Leaf.

"The combination of rising interest rates, the introduction of home information packs (Hips) and volatility in the financial markets resulting in tightening of lending criteria, has certainly affected the confidence of buyers and sellers," he added.

Rics said that the downturn seems to be severest in East Anglia, and the West and East Midlands, though prices are still going up in Scotland and London.

Declining market Most commentators agree that the property market is now responding to the five rate rises imposed by the Bank of England since the summer of 2006.

With new mortgage approvals, as measured by the Bank of England, declining from the levels seen last year, a more subdued market seems inevitable in the coming months.