London house price inflation dropped further in June, according to the latest Rics UK Residential Market Survey.

And its research showed agreed sales in the capital declined alongside new buyer enquiries and new instructions.

The trend, is now being reflected in medium term price expectations where the 12-month indicator for London has flattened to a net balance of -1%, the second lowest reading of 2017 so far.

The political climate, Brexit and last year’s changes in Stamp Duty were all equally cited as contributing to the lethargy.

Simon Aldous MRICS from Savills, London said: “Prime London house prices have continued to soften recording small falls in both central and outer prime London locations over the past quarter.”

In June, 45% of chartered surveyors across London saw a fall rather than rise in prices at the headline level, over the last three months.

This was little changed from a net balance of -50% in May, and continues a trend of decline that started from mid-2016.

Respondents in London also observed a flat reading for newly agreed sales in June, with 5% more respondents seeing a fall in sales over the month. This decline is the fourth consecutive negative reading, and indicates more cautious stance from buyers over recent months.

However, newly agreed sales are predicted to remain broadly stable over the next three months.

John J King FRICS, from Andrew Scott Robertson, in Wimbledon, said: “The market is racing ahead of itself for houses below £1 million but has stagnated above £2 million. The market between these values is unpredictable, we are in for a long hard summer.”

New instructions declined over the last month in London, according to respondents, with 21% reporting a fall rather than a rise in property coming on to the market.

Rics chief economist Simon Rubinsohn

Rics chief economist Simon Rubinsohn said: “The latest results demonstrate the danger, however tempting, of talking about a single housing market across the country.

“Rics indicators particularly regarding the price trend are pointing towards an increasingly divergent picture.

“High end prime properties may be seeing prices slipping back but, for good or ill, prices are continuing to move higher in many other segments of the market.

“The term ‘uncertainty’ is featuring more heavily in the feedback we are receiving from professionals working in the sector.

“This seems to be exerting itself on transaction levels which are flatlining and may continue to do so for a while particularly given ongoing challenge presented by the low level of stock on the market.”

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