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House prices to fall further as buyers stay away

House prices have failed to record any monthly increase for a year-and-a-half, with the pressure on household budgets and the weak economy expected to push them down even further, a study from property analyst Hometrack has found.

But London is predicted to continue to buck the trend, with the Olympics set to heighten the strong interest shown by overseas buyers who consider the English capital a “safe haven” in the midst of the fallout from the eurozone crisis.

The study reported a “slow start” to the year generally, with 10.5pc fewer new buyers registering with agents compared with December, 5.4pc fewer properties listed and 14.3pc fewer sales agreed.

House prices remained flat in January, following a 0.2pc decrease in both December and November, the latest survey of 1,500 agents and surveyors found.

London is the only area in the study where prices went up, recording a 0.1pc increase, while the North East saw the sharpest monthly fall, dropping by 0.4pc.

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