However, the survey also contains some evidence that vendors are beginning to return to the market. A net balance of 15% of surveyors reported that new instructions had increased in October, compared to a reading of 5% in September. Significantly, all regions reported a rise in instructions for the first time since the onset of the credit crunch with the North, the South West and London leading the way.
Meanwhile, transaction levels continued to rise with sales per surveyor edging up to 19 over the past three months. As a result, the closely watched sales to stock ratio – a measure of market slack and a lead indicator of future prices–climbed a little further. It has now risen for ten consecutive months and stands at 30.
The pace of improvement in buyer interest slowed for the fourth consecutive month. The net balance of surveyors reporting an increase rather than a decrease in new buyer inquiries slipped from 35% in September to 31%. However, only East Anglia is seeing a fall in buyer inquiries while buyer interest is strongest in London.
RICS spokesperson Jeremy Leaf said: "Although the supply of property is beginning to pick-up, it is still insufficient to keep pace with the increase in demand which points to further prices gains in the near term. Cheap money remains a critical prop for the market and this is being reflected in the continuing appetite for finance from first-time buyers despite the large deposits still being demanded by lenders."
Have your say on this story using the comment section below