LONDON, July 22 - House prices in Britain dropped for a fifth month in a row in the three months to the end of June but signs are emerging that the market is close to bottoming out, according to a key report published on Tuesday. The Royal Institute of Chartered Surveyors (RICS) said a balance of 12 percent of its members saw house prices decline in the three months to the end of June -- less than the net 26 percent in May. "The housing market showed some signs of stabilising in June with prices declining at the slowest pace since February," RICS said in its report. "However, caution remains on the price outlook with surveyors commenting on the lack of first time buyers as a factor keeping a lid on the market."
Surveyors were more bullish on the housing market than a month earlier with fears that falling house prices could undermine the tentative recovery in Britain's economy receding. Nearly 70 percent of people in Britain own their own home and strong consumer spending -- boosted by rising house prices -- has helped keep the economy ticking over during the economic downturn of the last three years. A net balance of five percent believe house prices will fall over the next three months, a much stronger picture than May when 17 percent saw declines and the 48 percent who saw weaker prices in March. Confidence in sales prospects also rose. A net balance of 28 percent of surveyors expected activity to pick up over the next three months, up from 12 percent in May.
Completed sales, however, hit their lowest level since December 2000, meaning unsold properties rose to levels not seen since September of the same year. However, both measures show signs of slowing, underlining the belief that conditions in the housing market are improving. On a regional basis, the South of England, which has seen some of the biggest falls in house prices, showed signs of stabilising -- declines were at their slowest since February. Prices continued to rise in the North of England although the Midlands saw little change.//