Residential rents fell for the first time since April 2003 in the three months to October as the supply of properties to let surged, according to the latest survey from the RICS.

The RICS said that the rising supply reflected the numbers of homeowners unwilling or unable to sell in the current market choosing to become landlords. 'Would-be home sellers are opting to bide their time by catering for the increased demand rather than sell at distressed prices,' RICS said.

In particular, rents on houses in London and the south-east, where unemployment is expected to rise as job losses hit the financial services sector, have been particularly badly affected. In London, 53% of those surveyed reported falling rents while the balance of surveyors reported that rents were flat in July.

Among all property types – demand for rented flats appears to be holding up better – a balance of 39% of London surveyors reported rents falling rather than rising. Nationally, across all property types a balance of 14% expected rents to fall rather than rise in the future.

Financial Times, The Times, The Independent