HOUSE prices in the South East fell at the slowest pace for 11 months in July, according to the latest housing market survey from the Royal Institution of Chartered Surveyors (RICS).

Across the South East 50 per cent of chartered surveyors who responded to the survey reported prices had stayed the same, with 35 per cent believing prices had fallen between zero and two per cent during July.

For the first time in more than a year, South East surveyors do not expect prices to fall any further.

Although overall market conditions remain subdued, with sales still down 18 per cent compared to last year, the RICS believes the housing market’s lowest activity levels may have passed.

Trevor Hines, RICS South East regional director, said: "Some signs of recovery are evident in the market.

"Would-be buyers have become more confident as a result of the interest rate outlook, while the economy continues to deliver steady growth, despite the past year’s slowdown.

"The anticipation of an interest rate cut in August has helped to raise surveyors’ sales outlook to a two year high.

"While the economy has slowed, growth continues at a modest pace which is conducive for generating housing demand.

"The August interest rate cut will support a further rise in buyer activity, though there is little prospect of a renewed house price boom anytime soon."