House prices dip for first time in a year

Demand for UK property has dipped for the first time in 12 months in the latest sign of housing market weakness.

However, lack of supply will continue to push up house prices despite short-term uncertainty, according to the latest RICS UK Residential Market Survey for April.

The survey shows that demand from buyers has dropped for the first time since March 2015.

The slowdown follows the buy-to-let rush that preceded the 1 April tax rise deadline, and reflects continued uncertainty caused by the EU referendum.

Sales are forecast to remain flat over the coming three months with the outlook in London significantly worse than other parts of the UK.

Despite the drop in demand from buyers prices have continued to rise, although at a more moderate pace.

The exceptions are central London, which saw a modest decline, and the North where prices remain flat.

RICS chief economist Simon Rubinsohn said: "Uncertainty is a word that features heavily in the feedback we are receiving from members and is contributing to the flatter trend.

“More ominous is the expectation that both prices and rents will head materially higher over medium term despite existing affordability concerns with the supply pipeline continuing to fall short of household growth."

Prices are forecast to rise across the whole of the UK with 61% more chartered surveyors expecting them to rise rather than fall across England and Wales over the next 12 months. 

Brian Murphy, head of lending at Mortgage Advice Bureau, said the data suggests that uncertainty ahead of the referendum is starting to have an impact on buyer demand.

"Some perspective is called for though, as February and March were particularly busy due to investors and second home purchasers aiming to beat the April stamp duty surcharge deadline."