London house prices hit by March slump

<a href="";>HOUSE prices</a> have come to a standstill this month as sellers return to the market after a dismal winter.

The latest survey by property website Rightmove shows that UK property is now a buyers’ market and new sellers have been forced to ask for just 0.1 per cent more, the lowest rise ever-recorded in March.

London has been particularly badly affected with the average asking prices falling by up to 2.5 per cent. Rightmove said the market had become more competitive in the past month with improved weather conditions resulting in a 26 per cent increase in sellers.

The survey added that the shortage of housing on the market in January and February had forced asking prices artificially high and that this month had witnessed “a degree of correction.” Overall house prices in the first quarter of 2010 rose by 4.9 per cent.

It is usual for the property market to suffer a winter lull followed by a New Year bounce. But property analysts have expressed concern of this latest fizzling out before spring.
Miles Shipside, commercial director at Rightmove said: “A rush of post-snow sellers coming to market in a short space of time has contributed to them having to give away some of the gains made in asking prices the month before when new sellers were more scarce.”

A total of 17, 923 properties are currently on the London property market, up from 3,681 in February. It is the highest weekly average of properties coming to market since before the collapse of Lehman Brothers, Rightmove said.

However, new builds are down 23 per cent on the average pre-credit-crunch levels of 2005 to 2008. This has meant properties staying on the market for an average period of only 70 days, down from 91 in the space of a month.

“The shortage of stock for sale carried over from last year has meant sales are brisk for the right property as supply has failed to keep up with demand in popular areas. This has meant properties stay on the market for shorter periods,” Rightmove said.

UK house prices in February grew at their slowest pace since August.