HOUSE prices in the South East have continued their decline in 2005, although at a slower rate than three months ago, according to the latest survey by the Royal Institution of Chartered Surveyors (RICS).

RICS also reported that sales activity is picking up after eight consecutive months of decline and surveyors are confident activity will now increase steadily.

Trevor Hines, RICS South East director, said: "Sellers remain unwilling to lower asking prices and, with buyers looking to secure a bargain, this has resulted in a rather slow recovery.

"The strength of the wider economy should support the housing market in the coming months, despite property becoming less affordable as a result of higher interest rates.

"The market has most likely already hit its lowest point and we should see a recovery in activity, though the prospect of further interest rate rises will keep conditions restrained.

"This has resulted in slowing or perhaps halting the downward trend in house prices."