The industry body said its members have also seen the biggest drop in inquiries from new buyers since April 2020, at the start of the COVID pandemic, while prices rose at the slowest rate since. January 2021 and should stabilize.
“Concerns over the economic backdrop and rising interest rates continue to weigh on market momentum, with strong activity at the start of the year now giving way to a more subdued picture,” said Tarrant Parsons, economist at the RICS.
Britain, like many Western economies, has seen a spike in property prices during the COVID-19 pandemic as people seek larger homes as they spend more time at home.
Despite the end of tax relief on house purchases, rising interest rates and the fastest consumer price inflation in 40 years, leading measures of house prices in Britain remain higher than expected. at least 10% of those of a year ago.
But RICS said the balance of its survey of sales expectations over the next 12 months – which measures the difference between the percentage of surveyors forecasting a rise and those forecasting a fall – fell -45 in August. , compared to -36 in July.
This is the lowest reading since this question was first asked in 2012.
The RICS house price balance fell +53 in August from +62 in July, a revised down figure, well below economists’ forecast in a Reuters poll that it would remain broadly stable and would be the lowest since January 2021.
A lack of homes for sale is keeping prices up for the time being, Parsons said. The same measure of house prices for the next 12 months fell only +3.
A Reuters poll last week showed economists forecast house prices to rise just 1% next year, compared to an estimated 7% for 2022.