Interest in house-buying dropped in Scotland in July, as did prices, according to surveyors.

The Royal Institution of Chartered Surveyors (RICS) said there was also a drop in the number of instructions from sellers.

The survey suggested that demand for new homes in Scotland has flat-lined or fallen over the past few months.

RICS said the decline was in part down to buyers finding it difficult to get mortgages.

Further falls are expected in the coming months but the end of the holiday period should herald an upturn across the industry, respondents hoped.

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In Scotland, 27% percent more surveyors expected prices to continue to fall rather than rise.

Sarah Speirs, director of RICS Scotland, said: "Activity in the housing market failed to result in a higher level of actual transactions in July.

"Fewer sellers are putting their homes up for sale and the ongoing problem of accessing affordable finance is not helping and does not look set to change in the near future. If vendors want to sell their homes quickly, they will have to be realistic in their price expectations."

A separate study came out yesterday suggesting that Scots are selling their homes for almost 10% less than their asking price.

The s1homes survey said the 'reality gap' between asking prices and selling prices averaged more than £15,000, with the exception of Edinburgh, which is 'bucking the trend'.

(NE)