London house prices falling at fastest rate in nine years, says Halifax

House prices in London are falling at the fastest rate in nine years, according to Halifax, Britain’s biggest mortgage lender.

Prices in the capital were down 3.2% between January and March compared with the previous quarter, the sharpest decline since the depths of the financial crisis, according to regional data collated by IHS Markit and published by Halifax, part of Lloyds Banking Group.

London also recorded the sharpest fall in annual house prices since the start of 2011. Property values fell 3.8% in the first quarter from a year ago, following a 0.7% annual drop in the fourth quarter.

In south-east England there was a small annual increase in prices at the start of the year, of 0.3%, while the south-west posted a rise of 1.9%.

Elsewhere, prices grew strongly. The east Midlands and East Anglia recorded the fastest rates of annual price inflation, of 7.3% and 7.2% respectively, followed by Scotland at 6.7% and Yorkshire and the Humber at 6.1%.

The average price of a home in London was £430,749 in the first quarter, the lowest since the end of 2015. In the south-east the figure was £337,776, a one-year low.

But such prices are still far above the average UK figure of £223,819. Apart from London and the south-east, only the south-west (£237,371) and east Anglia (£236,335) remain above the national figure.

The lowest average house prices can be found in Northern Ireland (£127,793), Scotland (£145,837) and the north of England (£146,648).

Across the UK, house prices stalled in the first quarter. Paul Smith, economics director at IHS Markit, said: “The subdued performance of the UK housing market, especially in the south of England, seems to reflect a general lack of appetite amongst households at present for activity related to major purchases in line with the general squeeze on real incomes seen in recent months.

“Allied with a general undercurrent of Brexit-related uncertainty, plus the likelihood of higher – albeit still historically low – interest rates later in the year, the market seems set to persist in a subdued state for the foreseeable future.”

The figures came as Britain’s property surveyors gave their most downbeat assessment of the housing market for five years.

The Royal Institution of Chartered Surveyors (Rics) said that in March demand from buyers fell for the 12th month in a row, new instructions from sellers declined for the seventh consecutive month, and prices were flat nationally.

One surveyor, Toby Whittome of Jackson-Stops in London, said stamp duty increases and Brexit had “killed the fluidity of the London market”.