London property slide continues with biggest drop in decade

A sign advertising a property for sale under the government's Help To Buy scheme stands next to a building site in London, UK, on March 26, 2019.
A sign advertising a property for sale under the government's Help To Buy scheme stands next to a building site in London, UK, on March 26, 2019.PHOTO: BLOOMBERG

ZURICH (BLOOMBERG) - London continued lead the UK's weakening property market at the start of 2019, with values falling the most since the financial crisis a decade ago.

Nationwide Building Society said values in the capital dropped 3.8 per cent year-on-year in the first quarter. That's a seventh straight decline and leaves London as the worst-performing region in the UK.

Nationally, values rose 0.2 per cent in March from February, according to a report on Friday (March 29). The annual rate of change improved to 0.7 per cent from 0.4 per cent, though Nationwide said the market remains "subdued."

Some of weakness relates to Brexit, which is having an impact on sentiment in the market. Consumer confidence remains close to its lowest level since 2013, according to GfK.

The uncertainty over when and how the UK will leave the European Union has gotten worse as the government extended the deadline, having so far failed to get lawmaker approval for its exit deal. Still, a shortage of homes, record employment and low interest rates are preventing an even sharper downturn in the property market.