Further house price drops 'possible'

14-May-2009

Property prices could drop further still in the coming months, according to the chief economist at the Royal Institution of Chartered Surveyors (Rics).

Simon Rubinsohn said that there is still the possibility that the value of housing will be at a lower cost at the end of 2009.

First-time buyers who can afford a deposit may see the next few months as a good time to buy their first property, as prices come down to a more affordable level.

Indeed, Halifax suggested earlier this month that property prices are at their most affordable level since January 2003 - for those looking for their first mortgages.

It is a "hard call" to predict what property prices will do, said Mr Rubinsohn, who has not ruled out a potential hike in values later this year.

"It all depends to a large extent on whether or not this lack of supply - which is very visible in [Rics'] new instructions balance, [and] which every month in the last two years, virtually, has fallen - continues," he explained.

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