The property market is moving at its slowest rate for five years, Home.co.uk claims.
Analysis of listings data from the property website found the median time on the market for May is 89 days – 11 days longer than the same month last year and the slowest rate for this time of year since 2014.
Time on the market – defined as the period between listing and sold subject to contract – is now at its slowest rate in ten years for London at 96 days.
Supply continues to fall, with new instructions down 9% year-on-year across the UK and down 28% in the capital, while total stock levels are up just 1.7%.
This malaise has seen asking prices increase just 0.5% on a monthly basis but fall 0.2% annually to £307,521.
Doug Shephard, director of Home.co.uk, said: “Uncertainty is a highly corrosive factor for the economy. Decisions are postponed indefinitely, projects put on hold and normally bold actors become cautious in the midst of the unknown.
“The Brexit mess may not hamper the purchase of a pair of jeans, but the housing market is severely affected because the stakes are so high.
“Key factors such as cost, importance of timing and the irreversible commitment involved in a home purchase make the current economic environment almost unbearable for the average buyer or seller.
“Uncertainty in the market moves the ‘invisible hand’, a term coined by Adam Smith to describe the unobservable market force that helps the supply and demand of goods in a free market to reach equilibrium.
“That equilibrium is vital for price recovery but is currently being undermined by a growing crisis of confidence in the housing market, especially in Greater London.
“While evidence of falling demand is widespread across the UK, in London both supply and demand are collapsing, and this is causing an acute distortion of the market.
“Price fluctuations during such episodes are to be taken with a pinch of salt. Low volumes lead to extreme volatility in several key market price indicators.
“Take the Halifax and Rightmove indices, which are showing wild variations from month to month and adding to confusion in the marketplace.”
By MARC SHOFFMAN
Source: Property Industry Eye