The number of unsold properties on the market fell in October--the fifth consecutive monthly decline--and are at their lowest levels since February this year. The number of new properties coming onto the market seems to be failing to keep pace with sales. But buyer enquiries registered a fifth consecutive monthly gain in October as the employment climate improved.

Inevitably such a combination leads to rising prices and over the three months to October 2003 38 percent more surveyors reported a rise in house prices than a fall, compared to 31 percent in September. This is the highest rate of increase seen since December 2002.

RICS housing spokesman Ian Perry said: "We believe sales are likely to pick up over the next few months but we are going to see buyers become although going into next year, we will see a slowdown from current unsustainable house price rises particularly if another interest rise is not far behind."