London house prices in worst slump since crash
London's housing market is in its worst slump since the depths of the financial crisis eight years ago, part of a broader slowdown that may continue.
The Royal Institution of Chartered Surveyors said its price balance for the city fell to the lowest since February 2009 last month.
It declined to minus 49, indicating that a greater percentage of agents reported drops in March. Still, more respondents than not expect prices in London to rise over the next year, the report showed.
According to Samuel Tombs at Pantheon Macroeconomics, the London measure tends to represent the prime market rather than the city as a whole.
The slump in the gauge tallies with other reports of sellers in central London having to cut prices to close deals.
Nationally, the RICS price index stayed at 22 in March, though the expectations for both values and sales over the next year weakened. New buyer inquiries and sales were stagnant, with the most expensive properties among the worst performers, the report said. In addition to buyers being kept out of the market because of high prices, nervousness about Brexit and the UK outlook are also weighing on demand.
Any downside to prices may be limited because of the continued shortage in the supply of property to buy, with estate agents' listings at a record low.
"High-end sale properties in central London remain under pressure, while the wider residential market continues to be underpinned by a lack of stock," said Simon Rubinsohn, RICS chief economist.
"For the time being it is hard to see any major impetus for change in the market, something also being reflected in the flat trend in transaction levels."
Meanwhile, separate data shows that more British lenders plan to rein in the supply of credit to consumers in the next three months than at any time since the 2008/09 financial crisis, according to a Bank of England survey that may add to concerns about the economic outlook ahead of Brexit.
A net balance of 18.8pc of British lenders expect to tighten the availability of unsecured credit to consumers in the next three months, the BoE's quarterly credit conditions survey showed.
The last time the BoE conducted the quarterly survey, 7.9pc of banks said they planned a similar tightening.
The new result marked the biggest proportion of lenders planning to tighten consumer lending since the end of 2008 - when Britain was in recession. The economic outlook was reported as by far the biggest drag on plans for credit supply.
Consumer credit expanded strongly last year, helping to sustain spending by households that fuelled strong growth after last June's vote to leave the EU. (Bloomberg/Reuters)