Property market faces stagnation in London and South as buyers stay out

A struggling housing market faces prolonged stagnation as would-be buyers sit on their hands, new figures warned on Thursday.

The latest RICS snapshot showed agreed sales at their weakest since March in August, with agents also signalling declining interest from new buyers over the month as the Bank of England raised interest rates.

In a diverging market London and the South-East remain in the doldrums as relatively high prices and Brexit uncertainty reigns, though sales have risen in areas like Scotland and Northern Ireland.

The picture in the capital and South is “rather more challenging”, RICS chief economist Simon Rubinsohn said.

Hansen Lu, property economist at Capital Economics, warned: “We forecast a further slowdown in house price inflation over the coming months, which will then be extended throughout 2019.”

Shore Capital’s housing analyst Robin Hardy also predicted flatlining house prices for next year, adding: “Agents are less bullish on the outlook for pricing.”