London house prices set to slide as caution lingers in the UK property market

Fears of flat activity in London’s housing market were underlined by a new closely-followed survey this morning, which suggested property prices will continue to sink as buyer caution looms over the capital.

According to data released today from the Royal Institution of Chartered Surveyors, 41 per cent more respondents have predicted a further fall rather than a rise in house prices over the next three months.

However, some 47 per cent more respondents also said they witnessed a drop as opposed to a bump in London property prices during October, improving from the same month last year when 67 per cent more respondents reported weakened prices.

“The London numbers remain disappointing with current activity subdued and the forward-looking indicators providing little prospect of an improvement anytime soon. Ongoing uncertainty about what a Brexit deal, or a no-deal outcome, might mean for the capital’s economy is clearly weighing on sentiment at the present time,” according to Rics chief economist Simon Rubinsohn.

He added: “But it is not the only issue holding back potential purchasers. At the higher end, stamp duty land tax remains a key impediment while elsewhere, affordability/ deposit requirements present a greater challenge. Unfortunately, I struggle to see where relief for either of these obstacles likely to come from.

The news comes a day after the Halifax house price index showed that property values in the UK slowed to their lowest annual rate of growth in more than five years last month.

Brian Murphy, head of lending for Mortgage Advice Bureau, said: “What would appear to be consistent.. is the continuing lack of properties available as even in those areas where demand is still significant and prices are still on the ascendant, the numbers of new listings over the last month would appear to have remained subdued. This may well assist with underpinning current values in some areas where demand is significant, although in others a lack of homes being listed for sale may add to the current market malaise as buyers can’t find what they are looking for, leading to a stagnating environment.”