UK housing market hit by widest prices falls since 2009 - RICS

Property estate agent sales and letting signs are seen outside an apartment building

By William Schomberg

LONDON (Reuters) - Britain's housing market suffered the most widespread price falls since 2009 last month as the run of interest rate increases over the past year weighed on would-be buyers, according to a survey published on Thursday.

The Royal Institution of Chartered Surveyors (RICS) house price balance, which measures the gap between the percentage of surveyors seeing rises and falls in house prices, fell to -47, the lowest since April 2009, from -42 in December.

A measure of interest from buyers also fell to -47, its lowest since October last year.

Simon Rubinsohn, chief economist at RICS, said the overall mood of the market as measured by surveyors remained subdued.

"However, it is questionable how much downside to pricing there is likely to be given that recent macro forecasts from the Bank of England and others are now envisaging a less harsh economic environment this year," Rubinsohn said.

The BoE last week said Britain's economy would probably fall into recession in early 2023 and would only come out of it in early 2024, a shorter period of contraction than in its previous set of forecasts.

The RICS report showed surveyors were less pessimistic about the outlook than in December with a measure of expected sales over the next 12 months improving to -20 from -42.

Other housing market measures have also recently shown a loss of momentum following the surge in demand seen during the coronavirus pandemic.

A Reuters poll of economists and analysts in November predicted house prices would fall around 5% this year having surged by 28% since the start of the pandemic in 2020.

RICS said the rental market continued to show strong interest from tenants with limited availability of stock.

(Reporting by William Schomberg; editing by David Milliken)