Brexit uncertainty is weighing heavily on London and the south east’s housing markets as house prices are expected to continue to drop over the next 12 months.
Buyer demand is dropping with new enquiries falling for the eighth month in a row, according to The Royal Institution of Chartered Surveyors (Rics).
Still, Rics painted the outlook as only “marginally negative” as house sales across the UK will dwindle until July before the downturn is reversed.
Rics’ poll of members found that the number of respondents who believe house prices will be higher in a year has grown since February.
However, London and the south east are suffering from a prolonged time to sell properties, with the south east taking 21.5 weeks and the average UK property taking 19 weeks, its joint worst since records began.
Almost a quarter of surveyors predicted house prices will drop again in March with predictions of a “modest fall” over the next six months.
In a sign of the softness of the market, Rics also revealed that fewer homeowners are putting their properties up for sale, with the average of just over 42 properties per branch near a record low.
Rics chief economist Simon Rubinsohn said: “Brexit remains a major drag on activity in the market with anecdotal evidence pointing to potential buyers being reluctant to commit in the face of the heightened sense of uncertainty.
“Whether any deal provides the shift in mood music envisaged by many respondents to the survey remains to be seen but as things stand, there is little encouragement to be drawn from key RICS lead indicators.
“We expect transactions to decline on this basis.”