RICS indicates the House-Price Balance at its lowest ever

The Royal Institution of Chartered Surveyors’ believe that the U.K. housing market has fallen to the lowest measure of sentiment since records began in 1978 as a result of the difficulty of acquiring a mortgage last month.

Price expectations have also dropped to a 10 year low, as well as retail sales falling for the first time in two years.

The tumbling house prices, the worst experienced In the UK since 1992 will make the incoming recession more likely as the slowdown in the economy will be accentuated.

The grow predicted by the International Monetary Fund earlier this year already seems to be over optimistic.

The Bank of England has responded as expected by lowering the benchmark interest rate, although the banks and mortgage lenders have raised the borrowing costs to the consumer as well as cutting bank of lending in general.

David Stubbs, an economist at RICS, said that the current situation is likely to get worse and only further cuts in interest rates could possibly restore shattered confidence in the property market.

In the meantime to make matters worse for the Uk economy the pound has continue to fall and has dropped to a record 80.64 pence against the euro, as well as further falls against the dollar.

This same lack of confidence is also being experienced in the retail sector, as shop revenue has fallen for the first time in two years last month.

With mortgages and bills taking up and even larger chunk of salaries, consumers as becoming increasingly concerned over the state of the economy and their own personal finances.

Story link: RICS indicates the House-Price Balance at its lowest ever