House sales are definitely slowing in the West Midlands in the face of the credit crunch, according to gloomy new figures from the Royal Institution of Chartered Surveyors.
The balance of chartered surveyors reporting house price falls decreased slightly in May but the average number of sales per surveyor fell further, says the RICS' UK housing market survey published today.
The number of chartered surveyors in the West Midlands reporting a price-fall dropped slightly in May to 76 per cent - down one per cent from April.
A further 18 per cent of surveyors stated that prices have remained the same and those reporting a price rise increased slightly from four per cent to five last month.
Demand continued to remain low in the region with chartered surveyors reporting a fall in new enquiries once again.
This lack of demand is reflected in the fall in sales, with the average number of transactions per surveyor over the last three months now at 17.4, the lowest figure since 1978.
Richard Franklin, RICS West Midlands spokesperson and divisional development director at Persimmon Homes, said: "The drying up of mortgage products has significantly affected the West Midlands housing market and sales are becoming ever more difficult to achieve.
"The purchasers are out there but the financial situation can let them down when trying to buy.
"Banks are lending considerably less than at this time last year, causing a stalemate in the regional market.
"While demand remains weak and housing transactions continue to slow, there is a very real danger to the wider economy.
"Potential impact on other sectors, such as the high street, leisure and home improvement, will be the inevitable next step."
Nationally, the RICS house price balance improved slightly for the first time in ten months but still remains a significantly depressed figure.
Almost 93 per cent more chartered surveyors reported a fall than a rise in house prices, a decrease from 94.7 per cent in April.
The regional picture remains depressed with surveyors in East Anglia, and the South East unanimous that house prices are falling.
Demand remains weak with the balance of surveyors reporting new buyer enquiries still in negative territory. However, all of last month's declines have been reversed nationally. Fifty one per cent more chartered surveyors reported a fall in buyer enquires compared to 69 per cent in April.
According to RICS, the lack of new instructions to sell property continues to provide the market with some signs of relief in the near term.
Large numbers of distress sales - either repossessions or sales from those attempting to avoid the repossession process - have not yet appeared in the market place and, while mortgage arrears remain low and until the worsening inflation picture filters through into the employment situation, this lack of supply will prevent significant declines.
In fact, the net balance of chartered surveyors reporting new instructions to sell fell to minus 26 per cent.