LONDON (Reuters) - House prices fell at their slowest pace in more than two years last month as demand from prospective buyers grew, suggesting property prices may be bottoming out, a survey showed on Tuesday.
The Royal Institution of Chartered Surveyors’ (RICS) seasonally adjusted house price balance rose to -7 in October from an upwardly revised -14 the month before.
It was the highest reading since December 2009 and easily beat economists’ consensus forecast of -15.
Interest from prospective buyers rose at its fastest pace since December 2009, adding to hopes that recent optimism about the British economy would encourage home buyers to get back onto the market.
“Whilst it’s still far too early to call an end to the housing market stalemate - headwinds abound - there are some early indications alongside the RICS survey which suggest, at least in the near term, the risks to activity and prices are very slowly shifting northwards,” RICS said.
The Bank of England’s Funding for Lending Scheme has helped ease some of the wholesale funding pressures for British banks, which saw some benchmark mortgage rates drift lower, with credit availability expected to improve over the coming months, RICS added.
“It seems that with Christmas around the corner, those who are in a position to buy decided to get out there and see what is available,” said RICS spokesman Ian Perry.
However, property sales remained sluggish with surveyors selling an average of 15.2 homes in October, from 14.9 last month.
“Overall activity is still very low in most parts of the country, and what the market desperately needs is for this to translate into actual sales,” said Perry.
London along with the South East were the only two regions where house prices rose.
Reporting by Li-mei Hoang; Editing by Hugh Lawson