The CEO of Haart estate agents has urged those selling homes in London to be more realistic with their asking prices.

Paul Smith made the comment after the average price of a UK property rose to £234,069, with transactions increasing by 14%.

With new buyer demand falling by 46% over the past month, Paul believes the current price rises are not sustainable.

He said: “We’ve seen a roaring month with the average house price up 1% on the month and 12% on the year, a record high. Sales also increased 14% over the last 12 months.

“However, there is trouble in paradise as we are also starting to see a big slump in buyer demand with registrations down a huge 46% across the UK in just one month.

“This has been compounded by buy-to-let investors pulling out of the market following the Stamp Duty surcharge, which came into effect on April 1.”

Paul thinks the nation is nearing the limit in terms price rises and that Haart’s data is showing a slow-down in both price growth and transaction levels.

Paul said: “In order to maintain healthy sales levels sellers need to be much more realistic with their asking prices – properties are in danger of being over-valued and these homes will struggle to sell.

“They could also be at risk of lenders refusing to grant high loan-to-value mortgage applications based on these too high valuations.”

But he added that this would be a “slight blip” in what he described as a powerful property market in the UK.

He said: “Despite the general fall off in new buy-to-let demand, we are continuing to see high levels of investment from Europe – there is still a huge appetite to invest despite the upcoming EU referendum.

“Regardless of the result, the UK and in particular London, will remain a global safe haven for property investment.”