LONDON, Oct 8 (Reuters) - The decline in British house prices eased unexpectedly in September and surveyors forecast that sales would pick up in the wake of government efforts to make mortgages more readily available, a survey showed on Tuesday.
The Royal Institution of Chartered Surveyors' seasonally adjusted house price balance rose to -15 from an upwardly revised -18 in August, the body said. Economists had expected a slight worsening to -20.
Moreover, expectations for future sales reached the highest level since May 2010.
"The housing market was relatively flat during September but surveyors are optimistic that the run into Christmas could see an increase in activity in many areas of the country," said Peter Bolton King, RICS Global Residential Director.
"Despite this, problems still exist and more needs to be done to get the market moving," he added.
Unrealistic expectations on the part of vendors seemed to be stalling the transaction process, he said.
"Meanwhile, although the Funding for Lending Scheme appears to be improving mortgage availability, those at the very bottom of the housing ladder are still struggling."
The Bank of England said in its recent credit conditions survey that banks planned to make more loans available because of the Funding for Lending Scheme, which offers cheap funds to banks if they keep up lending to businesses and consumers.
However, mortgage data for August was very weak despite the scheme's launch on Aug. 1.
Other surveys have shown surprise falls in house prices in September, and most economists expect a further decline over coming months.
(Reporting by Sven Egenter; Editing by Hugh Lawson)
((firstname.lastname@example.org)(+44 20 7542 5109))
Keywords: BRITAIN PROPERTY/RICS