New buyer enquiries for August rose for the fastest pace since early 2004 says the Royal Institution of Chartered Surveyors (RICS’).

RICS believe that the boost is due to August?s interest rate cut. Completed property sales are also up, for the second month running, and have risen by 7.5 per cent from a low in February.

However, house prices continued to fall in August, but at the slowest rate in a year. The number of chartered surveyors reporting price falls for August fell to 26 percent, down from 36 percent in July.

There are signs the market is stabilising and receding fears of a house price crash. The slowdown in new instructions has led to a drop in the number of homes available for sale, though surveyors continue to report large stocks of property on their books.

RICS housing market spokesman, Jeremy Leaf said: “Sales are up by 7.5 per cent since February, indicating a return of confidence to the market. The pace of decline in house price falls is at its lowest in a year, also pointing to more stable conditions. The big question is whether the market is just stabilising or if this is the beginning of a sustained revival.

August’s interest rate cut, together with continued employment rises, at new record levels, have helped improve the demand for housing after a difficult year for the industry. However, affordability has not improved significantly for most would-be buyers, and a return to rapid prices rises is not on the cards.”