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Times are getting tougher, says RICS

The Royal Institution of Chartered Surveyors (RICS) is warning construction professionals to expect tougher employment conditions as housebuyer transactions collapse to levels last seen in the 1970s.

The alert was issued at the same time that RICS published its May 2008 UK housing market survey in which 92.9 per cent of surveyors polled reported house price falls against 94.7 per cent in April.

The survey results also revealed that the average number of completed property sales transactions per surveyor over the past three months fell to 17.4 per cent, the lowest level since records began in 1978, and 31.7 per cent lower than a year ago.

Jeremy Leaf, RICS spokesperson, said: “While demand remains weak and housing transactions continue to evaporate, there is a very real danger to the wider economy. Construction workers such as plumbers and bricklayers will start to see employment opportunities dry up as the pace of housing transactions continues to abate.”

Neil Hunt, a chartered surveyor and a director of Wilkins Vardy estate agents in Derbyshire, added: “Demand has plummeted to a crisis point, with sales at the lowest May level in memory. An avalanche of job losses in the housing industry is beginning to materialise, which could make current media stories look like the good old days.”

Another surveyor said that because of lack of confidence in the residential housing market and stricter mortgage lending criteria, a significant slowdown had been witnessed in the new-build sector. This was leading developers to reduce their completions and even shut down their sites.

These comments come on the back of the news that Barratt Developments, Persimmon and Taylor Wimpey have introduced a raft of initiatives designed to shore up their flagging revenues.

Persimmon and Taylor Wimpey plan to reduce headcounts, while Barratt has warned its subcontractors to expect reduced workloads.