British surveyors are recording falling housing prices by the worst margin since the market crashed in 1990, the Royal Institute of Chartered Surveyors said on Tuesday.
During the past three months, only four per cent of surveyors reported prices rising, while 57 per cent said they were falling, a net balance of minus 53 per cent.
When adjusted for seasonal factors, the net balance was minus 64.1 per cent, the worst figure for the housing market that the RICS survey has recorded since June 1990 when house prices began a half-decade slump. January's figure was -54.8 per cent.
"This is very soft indeed, reflecting the interplay between stretched valuations, tightening lending standards and widening lending spreads," said Michael Saunders at Citigroup.
"The further adverse effects of rising repossessions, weakening job growth and then probably a rise in unemployment still lie ahead."
Stocks of unsold property are piling up on surveyors' books at the fastest rate in nearly 20 years, suggesting prices have further to fall.
Surveyors said they each had an average of 92 homes on their books - the highest level since October 1998 - while recording an average of only 24.4 sales during the three month period on a seasonally adjusted basis.
Stocks of unsold property jumped by more than 8.5 per cent, the fifth consecutive monthly increase of more than 8 per cent.
The stock of unsold homes has now risen by 48.6 per cent over the past 12 months, the steepest rise in unsold property since 1989.
British house prices have tripled over the last 10 years, but the market has slowed over the past year, with many first time buyers no longer able to afford a house and lenders tightening up requirements for mortgages.
With credit scarce on global markets, mortgage interest rates have not fallen despite a cut of half a percentage point in the Bank of England's lending rate since December.
Some lenders have raised the deposits they require for first-time buyers seeking the cheapest loans.
But although prices have already begun falling month-to-month, Britain has yet to experience a year-on-year fall like the slump that has hit the United States.
Finance minister Alistair Darling said last week that Britain's housing market was slowing but remains "fundamentally strong". (Reuters)
UK house price indicator at worst since 1990 crash