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House sales slump to new low

New buyer inquiries increased for the second month in a row during December, as the combination of lower house prices and interest rate cuts tempted potential buyers back to the market.
But the growing interest failed to boost flagging property sales, with these slumping to a new low of 10.1 per chartered surveyor estate agent during the three months to the end of December, compared with 10.6 during the previous three month period, according to the Royal Institution of Chartered Surveyors.
The group warned that without an end to the current mortgage drought, the number of properties changing hands would remain depressed.
RICS spokesperson Ian Perry said: "Buyer interest is now at levels not seen since 2006 but without mortgage finance the housing market is at a standstill and transaction levels at an all time low.
"First-time buyers and owner-occupiers are now stuck in a market which does not fulfil their aspirations. The Government must act now to ensure that order is restored to the current chaos."
He repeated the group's call for the Government to implement the proposals put forward by Halifax Bank of Scotland head Sir James Crosby, namely to guarantee new residential mortgage backed securities. Mr Perry said: "Without this help there is a real danger that homebuyers will be frozen out of the market, transaction levels and prices will fall to new lows, repossessions will increase and negative equity will become common place. Together this has the potential to push the country deeper into recession."
The RICS research also showed that the number of surveyors across the UK reporting price falls had eased slightly during December, with 73.5% more saying prices had fallen than those who said they had increased, the lowest level since February last year.
But surveyors' confidence in prices going forward fell to its worst level since April 2008, with members in nine of the 10 regions in England and Wales reporting a drop in price expectations.
RICS said the large stock of unsold properties on estate agents' books relative to the pool of able buyers was the main factor depressing prices.
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