A net ten per cent of surveyors said house prices fell last month, the Royal Institution of Chartered Surveyors has reported today.
It says that it has doubts sales momentum will pick-up in the coming months because of Brexit concerns.
Rics said the report is the weakest reading on its price growth measure since September 2012, when a balance of 17 per cent of surveyors reported falling rather than rising prices.
Brexit is having an impact on the prices of homes but not all regions in the UK are seeing a drop in value
Simon Rubinsohn, chief economist at Rics, said: ‘Uncertainty about the economic outlook on the back of the never-ending Brexit negotiations appears a key drag on sentiment.’
The overall price indicator also fell in September – but only to a small extent, with a balance of two per cent of surveyors seeing falling prices.
House hunters shopping in the highest price brackets could land a bargain as Rics said that homes in this category are selling noticeably below the asking price, while properties listed at £500,000 and below are relatively steady.
For properties marketed at more than £1million, close to three quarters of surveyors said sales prices were coming in below asking prices – and 14 per cent said sales prices were on average more than 10 per cent below the initial asking price.
The current weakness mostly stems from London and the South East, however East Anglia, the South West and the North East also saw negative price balances.
Surveyors in London and the South East continue to give a negative assessment on the prospects for house prices over the coming year, Rics said.
Halifax’s data showed annual house price inflation slowly declining over the past year, while monthly and quarterly rises have bumped along in low single digits
Prices have continued to rise in other parts of the UK, with the strongest growth in Northern Ireland and Scotland – which is expected to continue at least for the next 12 months – the report said.
Rics’ data come after Halifax issued a report this week which, in contrast to Rics’ report, showed that house prices are rising albeit at the slowest pace for five-and-a-half years because buyers are adopting caution ahead of Brexit.
Halifax’s data showed that house prices were up just 1.5 per cent annually in October – down from the 2.5 per cent figure recorded in September.
However, the lender said the cost of the average home did rise in October after two consecutive months of falls, and now stands at £227,869.
Brian Murphy, head of lending for the Mortgage Advice Bureau said: ‘Whilst other house price indices released over the last week or so have pointed to modest level of growth at headline level, they’ve not provided as clear a picture as the data from Rics in terms of variations between region, and indeed how demand for properties at different price points within even the same local market are currently disaggregated.
‘What would appear to be consistent, however, is the continuing lack of properties available as even in those areas where demand is still significant and prices are still on the ascendant, the numbers of new listings over the last month would appear to have remained subdued.
‘This may well assist with underpinning current values in some areas where demand is significant, although in others a lack of homes being listed for sale may add to the current market malaise as buyers can’t find what they are looking for, leading to a stagnating environment.
When it comes to the lettings market, Rics said the quarterly data points to an improvement in tenant demand during the three months to October.
Alongside this however, landlord instructions continued to fall, remaining negative for a tenth straight quarter – the longest negative stretch since 1999, when Rics began recording the data.
Rics expects that on the back of this, rents will rise over the coming months albeit only modestly.
Murphy added that Rics members appear to be equally cautious about the health of the lettings market.
‘Although it would seem that in some regions, tenant demand has increased slightly which, together with some landlords exiting the market due to the impact of taxation changes on rental income, means that Rics suggest this may create a slight upwards adjustment in rents over the next quarter.’