House prices dropped for a third consecutive month in September, forced down by an increasing supply of properties on the market, research has indicated.
The Royal Institution of Chartered Surveyors said the balance of surveyors reporting a rise in new instructions during the month almost doubled to 22 per cent.
But the group said buyers were holding back, despite the increased number of sellers, as people wait to see how the market develops.
The number of surveyors reporting a fall in new buyer enquiries edged out those who saw a rise by 2 per cent, although this was down from a balance of 17 per cent of surveyors who reported a drop in buyers in August.
Some 36 per cent more surveyors reported falling house prices than those who saw a rise, up from 32 per cent more in August but around half of those surveyed said they thought house prices had stabilised.
A balance of 41 per cent of surveyors are predicting that house prices will continue to decline, the highest level since March last year.
RICS spokesman Ian Perry said: “The fresh influx of property to the market combined with a lack of buyers remains the key problem affecting the sector.
“First-time buyers are in particularly short supply as the high deposits required by lenders prevent them from taking their first steps on the property ladder. Without sufficient demand property prices continue to slip back.
“However, many areas are reporting a correction rather than dramatic falls in prices and vendors who are prepared to be realistic with pricing are still able to achieve a sale. It’s very much a buyer’s market at the moment.”